Track logs are important. And when it comes to dividends, there are a handful of stocks that have particularly impressive track records. These stocks not only reliably pay dividends; They have consistently increased their dividend for 25 years or more in a row.
I am referring, of course, to the Dividend Aristocrats. Not every member of this elite group is a great choice to buy right now, but some are. Here are three Dividend Aristocrats to buy in August.
Abvi (ABBV -4.17%) Its dividend has increased for 50 consecutive years. This makes the big pharmaceutical company a dividend aristocrat and a dividend king. AbbVie has increased its dividend by more than 250% since 2013 with the dividend yield now exceeding 3.7%.
However, it is not only profits that have risen tremendously. AbbVie’s stock price has risen more than 120% over the past three years. The stock ranked as the third best performing dividend in the first half of 2022.
The main blow against AbbVie is that the autoimmune disease drug Humira will face competition from biosimilars in the US early next year. This will pose a tough challenge for the company since Humira generated nearly 37% of total revenue in 2021.
However, AbbVie has a lot of rising stars in its product lineup. The company should quickly return to growth after the initial hit from Humira’s loss of exclusivity. Headwinds have also already been largely priced into stocks, with AbbVie shares trading at only 10.6 times expected earnings.
2. Abbott Laboratories
Abbott Laboratories (ABT -1.38%) It boasts a 50-year history of annual dividend hikes as does AbbVie. This is no coincidence: Until 2013, AbbVie was part of the Abbott Corporation. Since the two companies separated, Abbott’s company has increased its dividend by more than 235%.
However, there are some distinct differences between the two healthcare companies. Abbott’s dividend yield is only 1.7%. Its stock has also lagged significantly behind AbbVie’s performance over the past three years and so far in 2022.
However, Abbott’s business remains strong. The company is a market leader in every field it operates in, including diagnostics, generic medicine and nutrition. Abbott reported 14.3% year-over-year organic revenue growth in the second quarter. It also raised earnings guidance for the full year of 2022.
Abbott’s COVID-19 testing revenue is likely to decline. But the possibility of another wave of the Corona virus in the fall and winter may boost sales in the near term. The company also has several other growth drivers, notably including the FreeStyle Libre continuous glucose monitors.
PepsiCo (PEP 0.07%) She belongs to the same club as AbbVie and Abbott, increasing her earnings for 50 consecutive years. Dividends have doubled over the past 10 years. Pepsi’s yield is now approximately 2.7%.
The stock hasn’t always outperformed the S&P 500 in recent years. But even though Pepsi’s stock price drops slightly in 2022, it easily outperforms the market. Investors were attracted by the company’s stability in the beverage and snack business.
PepsiCo’s second-quarter results showed that its business was largely insulated from inflation. This is a huge plus with inflation soaring to its highest level in 40 years. The company continues to achieve solid growth as price increases are passed on to customers.
PepsiCo will likely lag behind the market after the current downturn ends. However, until that happens, the stock appears to be one of the best Dividend Aristocrats to buy.
Keith Spits holds positions at AbbVie and PepsiCo. The Motley Fool does not have a position in any of the stocks mentioned. Motley Fool has a disclosure policy.