In this dividend champions list, we will take a look at some of the best stocks to invest in.
Dividend Aristocrats are firms within the S&P 500 Index that have consistently raised their dividend payments for a minimum of 25 straight years. On the other hand, Dividend Champions are companies that have also maintained at least 25 years of dividend increases but may not be part of the S&P 500.
Despite the difference in classifications, stocks with a history of growing dividends have long remained a favorite among investors. After facing nearly two years of sluggish performance, these stocks are regaining popularity in 2025. Global funds focused on dividend-paying equities are now seeing renewed investor interest, as many look for reliable income sources amid ongoing economic and geopolitical uncertainty. According to LSEG’s Lipper data, dividend-focused exchange-traded funds worldwide attracted $23.7 billion in inflows during the first half of 2025 — marking their strongest showing in three years.
Steve Watson, an equity portfolio manager at Capital Group, made the following comment:
“Consistent dividend growth signals a company’s managers are disciplined at capital allocation and confident about future business prospects. With tariff negotiations likely to linger for months, dividend growers could provide portfolios with a measure of stability when markets become volatile.”
Given this, we will take a look at some of the best stocks in our dividend champions list.
Our Methodology
For this article, we scanned the list of Dividend Champions, companies that have raised their dividends for 25 years or more, and picked companies that are comparatively lesser known to investors but are reliable investment options. Next, the hedge fund sentiment was measured using data from 1,000 hedge funds tracked by Insider Monkey in Q1 2025. The list is ranked in ascending order of the number of hedge funds having stakes in the companies.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
12. Norwood Financial Corp. (NASDAQ:NWFL)
Number of Hedge Fund Holders: 3
Norwood Financial Corp. (NASDAQ:NWFL) is among the best stocks on our dividend champions list. In July, the company, along with PB Bankshares, announced that their boards have approved a merger agreement under which PB Bankshares will be merged into Norwood. The merger will create a combined institution with around $3.0 billion in assets, positioning it as a leading community bank serving Northeastern, Central, and Southeastern Pennsylvania.
This move significantly broadens Norwood Financial Corp. (NASDAQ:NWFL)’s presence, extending its reach into faster-growing markets across Central and Southeastern Pennsylvania. The company recently announced earnings for its Q2 2025 and reported strong results. Its return on assets improved by 31 basis points to reach 1.06% compared to Q2 2024. Net interest margin rose 13 basis points from the previous quarter and 63 basis points year-over-year. Loan growth was strong, with annualized increases of 4.4% for the quarter and 8.2% year-to-date. Meanwhile, deposits expanded at a 15% annualized pace year-to-date, while the cost of deposits declined by 20 basis points since Q4 2024.
Norwood Financial Corp. (NASDAQ:NWFL) ended the quarter with over $53 million available in cash and cash equivalents. On June 18, the company declared a quarterly dividend of $0.31 per share, which was in line with its previous dividend. Overall, it raised its payouts for 33 years in a row. The stock has a dividend yield of 5.05%, as of July 23.
11. California Water Service Group (NYSE:CWT)
Number of Hedge Fund Holders: 15
California Water Service Group (NYSE:CWT) is a California-based public utility company that offers drinking water and wastewater services. The company remains committed to securing a timely and positive outcome in its 2024 California General Rate Case, recognizing its importance in supporting infrastructure investment and maintaining long-term service reliability. On a broader economic level, management believes that the company’s steady performance, reliable results driven by rate base growth, and solid dividend program present a compelling opportunity to deliver long-term value to shareholders.
In the first quarter of 2025, California Water Service Group (NYSE:CWT) reported revenue of $204 million, down 25% from the same period last year. As of March 31, 2025, the Group held $90.1 million in cash and cash equivalents, including $45.7 million in restricted funds. In addition, the Group had access to $315 million in short-term borrowing through its credit lines, available upon satisfying the borrowing requirements for both the Group and its subsidiary, California Water Service (Cal Water).
California Water Service Group (NYSE:CWT) currently offers a quarterly dividend of $0.30 per share, having raised it by 7.1% in January this year. This was the company’s 58th consecutive year of dividend growth, which makes CWT one of the best dividend stocks on our dividend champions list. The stock has a dividend yield of 2.66%, as of July 23.
10. Community Financial System, Inc. (NYSE:CBU)
Number of Hedge Fund Holders: 17
Community Financial System, Inc. (NYSE:CBU) is a financial services firm with operations across four key areas: banking, employee benefits, insurance, and wealth management. Its banking arm, Community Bank, N.A., ranks among the top 100 banks in the US by asset size, managing over $16 billion. The bank serves customers through roughly 200 branches located in Upstate New York, Northeastern Pennsylvania, Vermont, and Western Massachusetts.
Community Financial System, Inc. (NYSE:CBU) recently announced earnings for the second quarter of 2025. The company posted revenue of $199.3 million, which saw an 8.4% growth from the same period last year. It reported net interest income of $124.7 million for the second quarter, marking a new quarterly record and reflecting a 14% increase, or $15.3 million, compared to the same period last year. During the quarter, the company also announced an agreement with Santander Bank, N.A. to acquire seven branch locations in the Allentown, Pennsylvania area. The acquisition includes select branch-related loans, deposits, and wealth management relationships, and is expected to advance the company’s previously outlined retail growth strategy.
Community Financial System, Inc. (NYSE:CBU) ended the quarter with $237.2 million available in cash and cash equivalents. On July 16, the company declared a 2.2% hike in its quarterly dividend to $0.47 per share. Through this increase, the company stretched its dividend growth streak to 33 years, which places it on the dividend champions list. The stock has a dividend yield of 2.66%, as of July 23.
9. Donaldson Company, Inc. (NYSE:DCI)
Number of Hedge Fund Holders: 18
Donaldson Company, Inc. (NYSE:DCI) is one of the best dividend stocks on our dividend champions list. The company manufactures filters used in a wide range of applications— from computers and power plants to large industrial machinery— helping protect these systems from damage and enhancing their overall efficiency. The stock has surged by over 6.6% since the start of 2025.
Donaldson Company, Inc. (NYSE:DCI) demonstrated its strength by reporting record sales and record adjusted earnings per share in fiscal Q3 2025. It also increased its full-year adjusted earnings per share guidance and accelerated its share repurchase program, buying back 3.3% of its outstanding shares since the beginning of the year. The company reported revenue of $940.1 million, up 1.3% from the same period last year. The revenue also beat consensus estimates by $6.65 million.
For the first nine months of the year, Donaldson Company, Inc. (NYSE:DCI) generated $251 million in operating cash flow and had $178.5 million available in cash and cash equivalents. The company remained committed to its shareholder obligation, returning $32.3 million to investors through dividends in the third quarter. Currently, it offers a quarterly dividend of $0.30 per share and has a dividend yield of 1.68%, as of July 23. The company has been growing its payouts for 29 years.
8. Commerce Bancshares, Inc. (NASDAQ:CBSH)
Number of Hedge Fund Holders: 19
Commerce Bancshares, Inc. (NASDAQ:CBSH) is a regional bank holding company that provides a wide range of services, including banking, lending, payment processing, wealth management, and trust solutions. Its success is supported by a solid compliance structure, strong capital position, careful risk management practices, and a strong emphasis on serving its customers. The stock has surged by nearly 3% in the past 12 months.
Commerce Bancshares, Inc. (NASDAQ:CBSH) reported strong earnings in the second quarter of 2025, with revenues of $448.4 million. The revenue saw a 6.7% growth from the same period last year and also beat analysts’ estimates by $12.54 million. Commerce reported solid financial results for the second quarter, driven by its diversified business model and the strength of its team. The performance was supported by an increase in loans, healthy fee income, low credit costs, and ongoing discipline in managing expenses— factors that have consistently contributed to the company’s long-term profit growth.
Commerce Bancshares, Inc. (NASDAQ:CBSH) is a strong dividend payer. The company currently offers a quarterly dividend of $0.275 per share and has a dividend 1.76%, as of July 23. It has been rewarding its shareholders with 56 consecutive years of dividend growth.
7. Brady Corporation (NYSE:BRC)
Number of Hedge Fund Holders: 21
Brady Corporation (NYSE:BRC) is known for providing industrial and safety products, with a primary focus on identification solutions and workplace safety. The company’s offerings include tough labels, safety tools, and signs designed to help businesses meet compliance standards. The stock has surged by nearly 4% in the past month.
Brady Corporation (NYSE:BRC) reported strong earnings in fiscal Q3 2025. The company posted revenue of $382.6 million, which showed an 11.4% growth from the same period last year. It reported strong organic sales growth in the Americas and Asia during the quarter, a performance largely attributed to its sustained investments in research and development along with recent product introductions. These efforts led the company to achieve a new record for adjusted earnings per share in a single quarter.
Brady Corporation (NYSE:BRC) remained committed to its shareholder obligation, returning $11.3 million to investors through dividends during the quarter. The company ended the quarter with over $152 million available in cash and cash equivalents and generated nearly $123 million in operating cash flow. It currently offers a quarterly dividend of $0.24 per share and has a dividend yield of 1.38%, as of July 23. The company holds a 39-year streak of consistent dividend payments.
6. MGE Energy, Inc. (NASDAQ:MGEE)
Number of Hedge Fund Holders: 21
MGE Energy, Inc. (NASDAQ:MGEE) is a regulated utility from Wisconsin that stands out for its strong financial position, careful capital management, and stable business model— unlike many industry counterparts that struggle with heavy debt, inflation-related cash flow challenges, and strict regulatory pricing. The company provides vital electricity and natural gas services through well-established infrastructure, benefiting from a reliable customer base and the steady economic conditions of Wisconsin.
In the first quarter of 2025, MGE Energy, Inc. (NASDAQ:MGEE) reported revenue of nearly $219 million, up 14.4% from the same period last year. The company’s operating income was $52.8 million, growing from $40.7 million in the prior-year period. In addition, its net income also grew from $33.8 million last year to $41.6 million in the most recent quarter.
MGE Energy, Inc. (NASDAQ:MGEE) is a strong dividend stock, having raised its payouts for 49 consecutive years. The company currently offers a quarterly dividend of $0.45 per share and has a dividend yield of 2.07%, as of July 23. It is among the best dividend stocks on our dividend champions list.
5. Carlisle Companies Incorporated (NYSE:CSL)
Number of Hedge Fund Holders: 26
Carlisle Companies Incorporated (NYSE:CSL) is involved in designing, manufacturing, and distributing products used in building envelopes and energy systems. The company serves a vital function in the real estate and construction sectors by providing key materials for commercial properties, particularly those related to waterproofing and other construction needs. The stock has surged by over 10% in the past month.
Despite facing a sluggish residential construction market, harsh winter conditions, and economic uncertainty from recent tariffs, Carlisle Companies Incorporated (NYSE:CSL) remained focused on its Vision 2030 goals. The company managed to maintain steady revenue of $1.1 billion, consistent with the previous year, and reported diluted earnings per share of $3.13 and adjusted earnings per share of $3.61. Improved weather conditions in March helped build momentum, which carried into April and marked the beginning of the summer construction season in the U.S.
Carlisle Companies Incorporated (NYSE:CSL) expects to generate around $1 billion in free cash flow in 2025, in line with earlier projections. Staying true to its strategy of delivering strong shareholder returns through balanced capital allocation, the firm has increased its 2025 share repurchase target from $800 million to $1 billion. In the first quarter alone, it bought back 1.2 million shares worth $400 million.
Carlisle Companies Incorporated (NYSE:CSL) currently offers a quarterly dividend of $1 per share and has a dividend yield of 1.12%, as of July 23. The company has been rewarding shareholders with growing dividends for the past 48 years, which makes it one of the best stocks on our dividend champions list.
4. AptarGroup, Inc. (NYSE:ATR)
Number of Hedge Fund Holders: 28
AptarGroup, Inc. (NYSE:ATR) has a global presence, generating about half of its revenue in Europe and 33% in North America. The company has completed nearly two dozen acquisitions, investments, and partnerships since 2016, expanding its reach and broadening its portfolio. The stock has surged by nearly 5% since the start of 2025.
AptarGroup, Inc. (NYSE:ATR) reported mixed earnings in the first quarter of 2025. The company posted revenue of $887 million, which showed a 3% decline from the same period last year. Pharma’s proprietary drug delivery systems delivered a 2% increase in reported sales and a 4% rise in core sales for the quarter. The company experienced heightened demand for its dosing, dispensing, and protection technologies across various segments, including treatments for central nervous system disorders, emergency medications, weight and diabetes management, and applications in food, beverage, and personal care.
AptarGroup, Inc. (NYSE:ATR) also posted a strong cash position during the quarter. The company’s operating cash flow was $82.7 million, and its free cash flow amounted to $25.8 million. It also returned $110 million to shareholders through dividends, which makes it one of the best stocks on our dividend champions list. The company has raised its payouts for 31 years in a row. Currently, it pays a quarterly dividend of $0.45 per share and has a dividend yield of 1.11%, as of July 23.
3. RLI Corp. (NYSE:RLI)
Number of Hedge Fund Holders: 32
RLI Corp. (NYSE:RLI) is among the best stocks on our dividend champions list. It is a specialty insurer that provides targeted coverage within the property and casualty insurance sectors. The company has built a strong track record over the years by consistently underwriting profitable policies.
RLI Corp. (NYSE:RLI) recently reported its Q2 2025 earnings and showed a stellar performance. The company’s revenue came in at $499.8 million, up over 20% from the same period last year. The revenue also beat analysts’ estimates by $56.4 million. The company reported underwriting income of $62.2 million, supported by a combined ratio of 84.5. While gross premiums written remained unchanged, net investment income saw a 16% rise. A significant boost to underwriting income came from favorable adjustments to prior years’ loss reserves, contributing an additional $24.4 million.
RLI Corp. (NYSE:RLI)’s operating cash flow for the quarter came in at $174.7 million, up 23% on a YoY basis. The company ended the quarter with $21.4 million available in cash and cash equivalents. Over the past five years, it has returned $971 million cumulatively in dividends. The company’s dividend growth streak spans 50 years. Its quarterly dividend comes in at $0.16 per share for a dividend yield of 0.93%, as of July 23.
2. RPM International Inc. (NYSE:RPM)
Number of Hedge Fund Holders: 35
RPM International Inc. (NYSE:RPM) is recognized for its wide range of specialty chemical products, catering to industrial, specialty, and consumer segments. Lately, the company has concentrated on boosting operational efficiency through its MAP 2025 program, which targets better supply chain operations and expansion in global markets. The stock has surged by nearly 4% in the past month.
In June, RPM International Inc. (NYSE:RPM) acquired Ready Seal, a Texas-based company known for its high-quality exterior wood stains, to enhance its Rust-Oleum Consumer Group. In 2024, Ready Seal brought in around $45 million in sales. This move is expected to bolster Rust-Oleum’s offerings in the growing exterior wood care market, which is attracting both professional contractors and DIY users. The company also plans to use its existing sales network and distribution channels to further boost Ready Seal’s product reach.
RPM International Inc. (NYSE:RPM) is a strong dividend payer with 51 consecutive years of dividend growth under its belt. The company offers a quarterly dividend of $0.51 per share and has a dividend yield of 1.81%, as of July 23. It is among the best stocks on our dividend champions list.
1. Badger Meter, Inc. (NYSE:BMI)
Number of Hedge Fund Holders: 39
Badger Meter, Inc. (NYSE:BMI) is recognized as a top-tier company in the market, known for its strong operational performance and potential for expanding profit margins in a fundamentally appealing industry. The company is well-positioned to benefit from long-term shifts toward greater resource efficiency, thanks to its emphasis on Advanced Metering Infrastructure (AMI) and Software as a Service (SaaS). These areas are becoming more important as regulations tighten and sustainability becomes a global priority.
In its recently announced earnings, Badger Meter, Inc. (NYSE:BMI) reported revenue of $238 million, which showed a nearly 10% growth from the same period last year. Operating earnings rose by 8% from the same period last year, reaching $44.9 million. However, operating profit margins slightly declined to 18.8% from 19.2% a year earlier. Diluted earnings per share (EPS) also saw a 4% increase, coming in at $1.17 compared to $1.12 in the previous year’s quarter.
Badger Meter, Inc. (NYSE:BMI) generated $44.5 million in operating cash flow, up 22% from the prior-year period. The company ended the quarter with $165.2 million available in cash and cash equivalents. It offers a quarterly dividend of $0.34 per share and has a dividend yield of 0.71%, as recorded on July 23. BMI is among the best stocks on our dividend champions list, as the company has grown its payouts for 32 years straight.
While we acknowledge the potential of BMI to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than BMI and that has 100x upside potential, check out our report about this cheapest AI stock.
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