Dividends are an important part of the total investment return of a stock, yet many investors ignore this component and instead focus on searching for stocks that might have more of a chance of price appreciation. They would do wise to pay more attention to this attribute.

IN PICTURES: How To Make Your First $1 Million

There are plenty of stocks that are solid dividend payers with great yields, some of which are also household names. Some of these companies have been paying dividends for more than 100 years. Proctor & Gamble (NYSE:PG) has steadily paid out dividends since 1891, and has increased its dividend payout each year for the last 55 years. The current yield is just under 3%.

Long-Time Dividends
Proctor & Gamble sells many diversified consumer products so it isn't surprising that the company has paid out a rising dividend stream for so long. However, PPG Industries (NYSE:PPG) is in many businesses leveraged to the industrial economy, so it might shock some to know that the company has paid dividends since 1899. The stock has a current yield of 3.5% and has increased its payout for 37 consecutive years.

One company on the cusp of entering the century club is H.J. Heinz (NYSE:HNZ), which has been paying a dividend since 1911. The stock has a yield of 3.9%, and has a five-year average dividend growth rate of 8.8%.

Automatic Data Processing, Inc. (Nasdaq:ADP) has only been paying a dividend since 1974, but the company has raised that dividend for 33 straight years. The stock yields 3.2% and the company has grown its dividends at a 23% average rate over the last five years.

Recession Cuts
Of course, dividends don't also protect investors. General Electric (NYSE:GE) has been paying a dividend since 1899, but the company was forced to slash that dividend during the financial crisis and recession. General Electric cut its quarterly dividend from $0.31 to $0.10 back in February 2009, freeing up an extra $9 billion annually to help its capital. General Electric stock declined to a low of $5.75 per share during 2009, down about 85% from its peak.

If these 3-4% dividends seem too small to be bothered with, consider that if the stock market returns 8% annually on average over a long-term horizon, a dividend of this size is half that return.

The Bottom Line
Many well-known stocks have paid dividends for more than one hundred years, including during the financial crisis and recession. Investors should look for these to boost the total return of their portfolios. (Learn more about issues that can complicate dividends for investors in Dividend Facts You May Not Know.)

Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!

Related Articles
  1. Mutual Funds & ETFs

    What Exactly Are Arbitrage Mutual Funds?

    Learn about arbitrage funds and how this type of investment generates profits by taking advantage of price differentials between the cash and futures markets.
  2. Investing News

    Ferrari’s IPO: Ready to Roll or Poor Timing?

    Will Ferrari's shares move fast off the line only to sputter later?
  3. Professionals

    10 Must Watch Documentaries For Finance Professionals

    Find out about some of the best documentaries that finance professionals can watch to gain a better understanding of their industry.
  4. Stock Analysis

    5 Cheap Dividend Stocks for a Bear Market

    Here are five stocks that pay safe dividends and should be at least somewhat resilient to a bear market.
  5. Investing

    How to Win More by Losing Less in Today’s Markets

    The further you fall, the harder it is to climb back up. It’s a universal truth that is painfully apparent in the investing world.
  6. Fundamental Analysis

    Use Options Data To Predict Stock Market Direction

    Options market trading data can provide important insights about the direction of stocks and the overall market. Here’s how to track it.
  7. Stock Analysis

    2 Oil Stocks to Buy Right Now (PSX,TSO)

    Can these two oil stocks buck the trend?
  8. Investing News

    What Alcoa’s (AA) Breakup Means for Investors

    Alcoa plans to split into two companies. Is this a bullish catalyst for investors?
  9. Stock Analysis

    Top 3 Stocks for the Coming Holiday Season

    If you want to buck the bear market trend by going long on consumer stocks, these three might be your best bets.
  10. Investing News

    Could a Rate Hike Send Stocks Higher?

    A rate hike would certainly alter the investment scene, but would it be for the better or worse?
  1. How do dividends affect retained earnings?

    When a company issues a cash dividend to its shareholders, the retained earnings listed on the balance sheet are reduced ... Read Full Answer >>
  2. What is the difference between called-up share capital and paid-up share capital?

    The difference between called-up share capital and paid-up share capital is investors have already paid in full for paid-up ... Read Full Answer >>
  3. Why would a corporation issue convertible bonds?

    A convertible bond represents a hybrid security that has bond and equity features; this type of bond allows the conversion ... Read Full Answer >>
  4. How does additional paid in capital affect retained earnings?

    Both additional paid-in capital and retained earnings are entries under the shareholders' equity section of a company's balance ... Read Full Answer >>
  5. What types of capital are not considered share capital?

    The money a business uses to fund operations or growth is called capital, and there are a number of capital sources available. ... Read Full Answer >>
  6. What is the difference between issued share capital and subscribed share capital?

    The difference between subscribed share capital and issued share capital is the former relates to the amount of stock for ... Read Full Answer >>

You May Also Like

Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!