King Dividends Stocks

Build Wealth Or Pay Bills

There is a plethora of ways to make money online to help with living expenses. We went over some of them in previous posts.

For this post, we will take a look at how you can invest in strong stocks called “Kings” and “Aristocrats” to build your wealth.

 

Need Help Paying Bills?

King dividends stocks are a great reliable source of passive income.  

 

 

The stocks reviewed in this post are for informational purposes only and are not to be construed as stock tips.

The stock market, as you know, is quite volatile. We are always warned not to invest all of our money in one stock and never invest more than we can afford to lose…hmmm.

 

No one wants to lose a penny!

 

“Buy low and sell high”

How many times have you heard that tiresome cliche? What if you think you’re buying low but then the stock goes even lower as you bite off all your nails, lose sleep, stress over it till your hair falls out and you wonder when it will bounce back if ever… and I’m talking about your hair AND your money! 

 

I’ve been there before, can’t you tell?

 

Let’s take a look at dividend stocks because for the most part, they are less volatile than regular stocks and we want to bypass the nail-biting stage, keep our stress level low and our hair follicles intact.  

 

Dividends from stocks can provide an excellent income stream that will supplement your monthly income, help to pay your living expenses, or help to build your nest egg. 

 

There are monthly dividend stocks.

 

There are quarterly dividend stocks.

 

Some stocks pay dividends just once per year.

 

If you have some money tucked away that you don’t plan on using shortly or it’s sitting in a retirement account, you can check with your financial advisor about investing it in dividend stocks. This is not a get-rich-quick scheme. It takes time but you should be able to make some money that will grow your portfolio and assist with your bills. Without further ado, let’s dive into king dividends stocks. 

 

 

What Are Dividend Stocks?    

Dividend stocks are a type of investment that pays out a portion of the company’s earnings to shareholders regularly. These payments, known as dividends, are typically made quarterly, annually, or monthly.  By doing so, companies share their profits with investors.

Dividend stocks are attractive to investors looking for a steady stream of passive income, as they provide a regular cash flow that can be either reinvested or used for other purposes such as monthly expenses. Additionally, by holding dividend stocks they can also offer the potential for appreciation as the value of the stock increases over time even though the shareholder may be withdrawing some or all of the dividends.

 

A Basic Guide To Kings

King dividends may be the stocks to invest in if you’re looking to maximize your investment returns and generate passive income.  

 

With careful selection, dividend kings can help you to grow your wealth. We will give tips on how you can go about selecting the best stocks for your portfolio. 

 

Get ready to take your investment strategy to the next level.

Let’s Take A Closer Look

Characteristics Of The Kings 

• Know The Kings

This elite group of dividend stocks could play a role in building a successful investment portfolio. They are known for their consistent and reliable dividend payments, making them an attractive option for investors seeking income. To fall into the king category, they must have consistent growth. 

Kings must have at least 50 consecutive years of growth in payouts. 

This shows a long-term history of commitment by consistently awarding shareholders with dividends. Make a note of companies in stable industries with a competitive advantage. Avoid companies in declining industries or facing significant challenges. 

Interestingly enough both Coca-Cola (KO) and Pepsi (PEP) are Kings with 61 years and 51 years respectively of dividend growth.

 

• Management & Leadership

Assess the company’s management team and their track record. Look for experienced leaders who have successfully navigated challenging market conditions and have a clear strategy for growth.

 

• Dividend Growth Potential

Consider the company’s potential for future dividend growth. Look for companies with a strong business model, innovative products or services, and a solid growth strategy.

 

• Valuation

Examine the stock’s valuation compared to its peers and the overall market. A stock that is undervalued may present an opportunity for capital appreciation in addition to dividend income.

 

• Dividend Sustainability

Analyze the company’s ability to sustain its dividend payments. Consider factors such as cash flow, debt levels, and the company’s ability to generate consistent earnings.

 

• Research And Analysis

Conduct thorough research and analysis on the dividends of your potential king stock picks. Utilize financial news, analysts’ reports, and company filings to gather information and make informed investment decisions.

 

According to the website, Time Stamped, there are 54 Kings as of March 4, 2024.

You can view them on their website

 

 

The website Sure Dividend also has a

list of all the kings as of March 4, 2024  

 

 

A Brief Look At 6 Kings

 

•  3M (MMM)

The leader of the pack with a 65-year streak of growth and payouts. 

• Farmers & Merchants Bancorp (FMCB)

This under-the-radar bank has increased its dividends for 58 years in a row.

•  Walmart Inc (WMT)

Walmart is a dividend king with over 50 consecutive years of dividend increases. I am a hopeless “Walmart-a-holic.”

 

•  SJW Group

This water company announced its 56th consecutive dividend increase in January 2024.

 

• Colgate (CL) Another well-known strong player for 61 years.

 

• Johnson and Johnson (JNJ)

Also at 61 years is Johnson and Johnson who are well known for their Band-Aids and over-the-counter meds.

 

 

What About Aristocrats? 

Dividend Aristocrats are solid stocks that are highly favored amongst investors. These stocks are resilient, less volatile than regular stocks, and have rewarded their shareholders with increasing dividends even during difficult times.

For a dividend stock to be considered an aristocrat, it must meet these requirements:

• At least 25 years in a row of dividend increases. 
• It must be in the S&P 500. (kings don’t have to be)
• Aristocrats must have a minimum market cap of $3 billion with an average daily trading volume of $5 million or more. 

 

Currently, there are 67 dividend Aristocrats as of Jan 2024 and they can be tracked on the S&P 500 Dividend Aristocrats Index.

 

 

Here Are 3 Aristocrats

1. Chevron (CVX)
2. Amcor (AMCR) 
3. Automatic Data Processing  (ADP)

 

What Are REITs? 

Real Estate Investment Trusts either own, finance and or operate real estate properties or similar assets that produce rental income. Several qualifications have to be met by REITs in addition to the fact that they must pay out 90% of their taxable income back to shareholders.

 

Benefits Of Dividend Stocks

Investors love dividend stocks and for good reasons. 

Firstly, they provide a reliable and consistent source of income. Unlike other types of investments that rely solely on capital gains, dividend stocks pay out regular dividends, allowing investors to generate passive income. This can be especially beneficial for retirees or individuals looking for a steady stream of cash flow.

 

Secondly, dividend stocks have the potential for capital appreciation. While the primary focus of investing in dividend stocks is the income they provide, the value of the stock can also increase over time as we stated above. This means that investors not only receive regular dividends but also have the opportunity to see their initial investment grow in value.

 

Thirdly, dividend stocks are often considered less volatile than other types of investments. Companies that pay dividends tend to be more stable and established such as the Kings and the Aristocrats. Their stability can provide a sense of security for investors and they can be particularly appealing during times of market uncertainty or economic downturns.

 

Lastly, investing in dividend stocks can be a way to diversify a portfolio. By including dividend stocks along with other types of investments, such as growth stocks or bonds, investors can spread their risk and potentially enhance their overall returns.

 

Ultimately, investing in dividend stocks can be a smart strategy for individuals looking to generate passive income, grow their wealth, and add stability to their investment portfolio.

 

Important Investing Tips 

• Pick Companies With A Great Payment History & Growth 

You should be covered here if you stick with kings and aristocrats.  

 

• Beware Of High-Paying Dividend Stocks!

These stocks are typically loaded with risks. It is very tempting to buy the cheapest stocks that pay the highest dividends. Quite often their dividend is not sustainable. This is what I did when I started my dividend investing journey. Well not only did the already low-priced stock decrease to half its value, but to my dismay, it also cut its dividend by half.  

 

• Buy At The Ideal Time

The stock market is quite volatile. It is always best to buy when the overall market is down. It is also very important to know the ex-dividend date and to make your purchase no later than the day before. I’ve done this and walked away with a hefty dividend of $532 within only 26 days! This market timing is crucial to your success. 

 

• Vary Your Portfolio

Just about the majority of analysts will say you must diversify your portfolio. Let’s say someone puts ALL their money on one stock and that stock crashes and burns!!! That would be a financial disaster and this is one reason why they advise you to vary your portfolio. 

 

• Invest In EFTs

Exchange-traded funds will have a mixture of stocks which is an awesome way to diversify. Choose funds that have dividend-paying stocks comparable to your strategy to accomplish your goal.  

 

• Dividend Reinvestment 

Buy and hold is the name of the game. If you do not need to use your newly found income stream to cover your monthly expenses then hold it in cash and wait for the best time to reinvest it into more dividend-paying stocks. You could also automatically reinvest your payouts and compound your earnings using what’s called a DRIP:

Dividend Reinvestment Plan

 

 

Don’t Miss Important Dates

• The Declaration Date

The date the board of directors confirms they’ll pay a dividend and the amount.

 

• The Ex-Dividend Date

You must possess the stock the day before the ex-dividend date or sooner to receive dividends. 

 

• The Dividend Pay Date

This is the date dividends are paid.

 

• The Date Of Record

Companies examine their records on this day to determine the eligible shareholders. 

 

Some Terminologies

Do your homework so you’ll know the metrics and their meaning. This is an important part of investing. Familiarize yourself with the following terms:       

          ▪︎ Stock Valuation

Evaluating the price per share.

 

           ▪︎ Dividend Yield

How much dividend is being paid? Divide yearly dividend payments by the price of the stock to arrive at this percentage.

 

          ▪︎ The Dividend Payout Ratio

The payout ratio is expressed as a percentage and it is the ratio of the total amount of dividends paid out to shareholders relative to the company’s net income. A lower payout ratio indicates that a company has room to increase its dividends in the future.

To calculate this percentage, divide the yearly dividends per share by the (EPS) earnings per share. 

 

• EPS vs Dividends

Earnings per share is the amount of a company’s net income from each outstanding share. 

The portion of earnings a company’s Board decides to pay to shareholders is called the dividends. 

    

           ▪︎ Dividend Growth Rate

The DGR is the percentage of growth a company’s dividends increased by over some time, typically a year.

 

 

Stay In Long-term & DIY

 Why DIY?

Learn how to place your own trades so you won’t need a broker. If you want to make fast moves and quick simple trades you won’t have time to consult with a broker so it’s important to know how to place your trades. 

Dividend investing is not a get-rich-quick process so patience is important while thinking long term.  

 

 

Utilize IRAs & ROTHs

Diversifying may require you to sell shares before making your next purchase. With each sale, you will be taxed on capital gains and this income has to be reported when you file your taxes. To minimize this loss, consider holding your investments in an IRA which offers some tax shelter. Seek your accountant’s advice for more details on this.

 

 

A Look At Strategies 

It’s a good idea to research the characteristics of the stocks you’ll be putting into your portfolio and determine what works best for you. Know what strategies exist even if you haven’t decided on one yet. 

 

High Dividends 

…but slow growth

As previously mentioned, low-priced stocks that pay high dividends are very tempting but sadly they usually are not sustainable. The dividend payout could come crashing down and even worse yet the price of the stock could fall and seriously hurt your initial capital. It is a riskier move to invest in these stocks. A lot of them will pay over 12% dividends which is tempting but again, it might not be sustainable. The stock price is less likely to increase and sadly at some point, they may reduce their dividend putting the dividend safety at risk.

 

High Growth 

…but low dividends

This type of stock usually yields around 3% or less but due to their high growth, their dividend rate could increase to 7% or more. These dividends are typically lower but safer. You’d be relying on stock price increases to make any gains.

 

Balance

…this may be the key

The stocks in this final strategy are more balanced both in growth and dividends. Not only will the share price increase but so will the dividend payout. 

 

 

Track Your Dividend Stocks

It’s important to have information at your fingertips about your portfolio of dividend stocks that you’re interested in.

I like to manually track the ones I’m interested in with good old-fashioned pen and paper, so I’ll have it at my fingertips. Of course, there are easier ways to do it and there are websites that offer free help, info, and charts.

Such As:

www.dividend.com

 

 

Points To Consider 

Before you start rubbing elbows with the stocks that are Dividend Kings, consider this important point:

Your Risk Tolerance

As with any stock, the possibility of losing your money does exist so plan on hanging in there and not getting discouraged if the stocks go down in price.   

 

 

Portfolio Building

Building a dividend portfolio requires patience, careful planning, and strategy. Consider the following building blocks:

1. Diversification

Diversify your portfolio by investing in a variety of dividend stocks across different sectors and industries. This helps to spread risk and ensures that your portfolio is not overly reliant on a single company or sector.

2. Reinvest Dividends

Consider reinvesting your dividend payments back into your portfolio. This can help to compound your returns over time and accelerate the growth of your investments.

3. Regularly Review

Sell underperforming stocks and add new ones with better growth potential.

 

4. Focus on Quality

Look for companies with strong financials, and a history of profitability and sustainability.

 

5. Consider The Aristocrats

Aristocrats are solid and have shown their strength with a minimum of 25 consecutive years of dividend increases as mentioned above.

They deserve consideration with this proven track record of rewarding shareholders.

 

6. Monitor The Dividends

Keep an eye on the sustainability of the dividends being paid by the companies in your portfolio. Look for companies with a reasonable dividend payout ratio and a strong ability to generate consistent earnings.

 

7. Stay Informed

Stay informed about the companies in your portfolio and the broader market. Keep up to date with company news, earnings reports, and industry trends to make informed investment decisions.

 

8. Seek Professional Advice:

If you are new to dividend investing or feel overwhelmed by the process, consider seeking professional advice from a financial advisor or investment manager. They can provide guidance and help you build a dividend portfolio that aligns with your financial goals.

By implementing these strategies, your portfolio can generate passive income and contribute to long-term growth. Remember to always do your research and make informed investment decisions based on your financial situation and risk tolerance.

 

 

Tips For Maximum Income

Maximizing dividend income is a key goal for many investors. Here are some tips to help you make the most of your dividend investments:

 

1. Make A List

List some low-priced stocks that are strong players. Compare their dividends and focus on the higher-yield companies. Stocks that offer a higher dividend yield, will increase the amount of income you receive from your investments. You shouldn’t have to worry too much about the sustainability of the dividend and the overall financial health of the company if your list has all kings and aristocrats.

 

2. Consider DRIPs

Dividend Reinvestment Plans allow you to automatically reinvest your dividend payments back into additional shares of the company’s stock. This can help to compound your returns over time and increase your overall dividend income.

 

3. Look for Dividend Growth

In addition to high-yield stocks, consider investing in companies that have a history of consistently increasing their dividends over time. These companies can provide a growing stream of income and help to protect against inflation.

 

4. Consider Dividend ETFs

Investing in Mutual Funds and ETFs will increase your diversification. These funds typically hold a variety of dividend-paying stocks.

 

5. Monitor Dividend Policies

Try To Avoid Surprises

Stay informed about the financial health of the companies in your portfolio. Some companies may cut or suspend dividends if they are experiencing financial problems. 

 

6. Rebalance Your Portfolio

Review your dividend investments regularly in case you need to sell underperforming stocks if necessary. You may also want to add new stocks that have more potential.

 

7. Utilize Tax Benefits

Depending on your country, your income, and tax laws, dividends may be subject to different tax rates. Consult with your accountant and make sure you understand the tax laws or benefits.

 

By following these tips, you can maximize your dividend income and make the most of your investments. Remember to always do your research and consult with a financial advisor if needed to ensure that your dividend strategy aligns with your financial goals and risk tolerance.

 

 

How Much Income Do You Need?

HOW TO CALCULATE THE AMOUNT OF MONEY TO INVEST TO GET THE DIVIDEND YOU NEED

Calculating Your Dividends

The amount of money you need to make per month can be calculated. 

 

For example: $1,000 per month equates to $12,000 per year.

 

If you need $12,000 in dividends per year, divide what you need by the yield to see how much money you will need to invest

Eg: 12,000÷13.3% yeild = $90,225

 

To Calculate Dividend Yield:

Take the dividend per share per year and divide it by the price of the stock.

 

So with a $1.00 yearly dividend per share and a stock price of $7.5

$1.00÷7.5 = 13.3% yield

 

How To Get Paid Monthly

So knowing that monthly dividend stocks pay monthly, you can easily set yourself up to receive a monthly passive income stream by picking a few solid monthly dividend-paying stocks, preferably kings and aristocrats. 

 

If you prefer stocks that pay quarterly but you’d still like to receive monthly dividends, then you can put together a portfolio of at least 3 strong kings or aristocrat stocks that payout in different months. Each stock has its quarterly schedule. 

 

For example, the 3 dividend stocks below pay quarterly dividends in different months. 

 

Make A Quick Chart

TICKER            PAYMENT MONTH

T    –      Jan        April     July      Oct

XOM – Feb       May      Aug      Nov

DVY  – March  June     Sept      Dec

 

You can do something similar to the illustration above so that all 12 months are covered.

 

 

Monthly Dividend Stock Ideas

■SLG 

■STA

■AGNC 

■MAIN

■EPR

■GROW

■ADC

■GLAD

 

 

A Look At Realty Income (O) 

 This monthly dividend Aristocrat is also known by its ticker symbol “O”. Its current monthly dividend is $00.26 and it will be paid on April 15, 2024.   Founded in 1969, their income comes from long-term real estate leases from well over 15,000 properties around the world.  They have increased their dividends 124 times since 1994.

 

 

Quarterly Dividend Stock Ideas

(Stock price subject to change)

 

• MO…….Altria Group…..$41
• T….…….AT&T…………………$15.45
• F…..…..Ford…………………..$14.00
• VZ…….Verizon………………$35.50
• TD……..TD Bank ……………$56.80
• MSFT…Microsoft………….$410
• KO….…Coca Cola…………..$61.20
• BAC…Bank Of America… $35.20

 

 

AI Dividend Stocks

It is said that AI stocks will mint the next millionaires. For the record, all industries will be affected by AI in some way or another. 

 

Some Facts About ChatGPT:

• After ChatGPT was launched it took less than a week to reach a million users.
• Within 2 months ChatGPT had 100 million new users. 
• ChatGPT has about a billion monthly users today!

 

That’s the power of AI 

 

ChatGPT does not offer dividends but there are AI stocks that do. Let’s look at a couple:

■ CGNG

■ SOUN

 

Wrapping Up

Dividend investing is not a one-size-fits-all venture. You are not locked into one strategy either. To minimize your tax liability, it’s a good idea to consult with your accountant and self-direct your investments. Take advantage of the shelter offered by an IRA or Roth. Know the terminologies, track your stocks, and make a spreadsheet or checklist to assist you with fast decisions. Since the stock market is so volatile some investors will only consider the Kings and the Aristocrats because they are more stable even though the dividend may be lower than stocks with less time in business. It’s important to do your due diligence before jumping in. It might be a good idea to check with your account and or an expert stock Analyst while doing your research.

 

Happy Investing &

Cheers To Your Wealth!

 

 

 

 

 

 

 

 

 

More Info On Dividend Stocks

• www.dividend.com
• https://www.fool.com/investing/stock-market/types-of-stocks/dividend-stocks/
• https://money.usnews.com/investing/articles/best-dividend-stocks-to-buy-this-year
• www.DividendStocks.com
• https://finance.yahoo.com/news/14-best-annual-dividend-stocks-154909451.html
• https://www.suredividend.com/dividend-kings/
• https://time.com/personal-finance/article/dividend-kings/