Why are Dividend Kings revered?

Dividend Kings are a distinguished group of companies that have consistently increased their dividends for at least 50 consecutive years. This achievement signifies their financial strength and resilience, even during economic downturns. As of 2024, there are 53 companies classified as Dividend Kings, which include well-known names like Altria Group Inc. and Universal Corp.

Pros and Cons of Investing in Dividend Stocks

Pros

1. Stable Income: Dividend stocks provide a reliable income stream, which can be particularly appealing for retirees or those seeking regular income from their investments.

2. Financial Stability: Companies that consistently pay dividends are often financially stable, suggesting they are on solid financial footing.

3. Market Insulation: Dividend investing can offer some insulation from the stock market's volatility, as dividends provide returns independent of stock price movements.

Cons

1. Limited Growth Potential: Dividend stocks may offer less potential for massive capital gains compared to high-growth stocks.

2. Tax Implications: Dividends are taxable events, which can create a tax drag, especially in taxable accounts.

3. Reduced Diversification: Focusing heavily on dividend stocks can lead to decreased diversification, as these stocks are often concentrated in specific sectors.

List of Dividend Kings

As of 2024, the Dividend Kings include 53 companies. Here are some of the top Dividend Kings by dividend yield:

• Altria Group Inc. (MO): 8.4%

• Universal Corp. (UVV): 6.8%

• Canadian Utilities (CDUAF): 6%

• Northwest Natural Gas Holding Co. (NWN): 5.5%

• Black Hills Corporation (BKH): 4.9%

• United Bankshares (UBSI)

Dividend Kings can be a valuable component of a diversified investment portfolio, offering stability and a steady income stream. However, investors should be mindful of the potential downsides, such as limited growth opportunities and tax considerations, and balance their portfolios accordingly.