Dividend Aristocrat
Quick definition: A Dividend Aristocrat is an S&P 500 company that has increased its dividend every year for at least 25 consecutive years.
In plain English
The label comes from an S&P index. To qualify, a company must be in the S&P 500, meet size and liquidity rules and have raised its dividend for 25 or more years in a row.
Example
A company that has raised its dividend every year since the late 1990s is a long-running member. If it freezes or cuts the dividend, it is removed from the list.
Why it matters
A long streak points to durable profits and a commitment to shareholders. It is a useful starting point for research, not a guarantee.
Common mistakes
- Assuming Aristocrats cannot cut. They can, and the streak ends when they do.
- Ignoring valuation, debt and the size of the increases.
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purposes only. The calculations, examples, and projections are simplified
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decisions and any outcomes resulting from them.
Past performance and projected returns do not guarantee future results.
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