Dividend Aristocrat

DEFINITION of 'Dividend Aristocrat'

A company that has continuously increased the amount of dividends it pays to its shareholders. To be considered a dividend aristocrat, a company must typically have raised dividends for at least 25 years. More specifically, the company needs to have a managed dividend policy that increased its dividend every year for those 25 years.


Companies that are able to maintain high dividend yields are often considered to be more stable than others, and because stocks maintaining this association must keep yields consistently high, the list of aristocrats is often under 100 companies.

BREAKING DOWN 'Dividend Aristocrat'

Dividend aristocrats are rare because most companies are unable to continually boost dividend payouts while also facing recessions and market shocks. Two of the more popular ways of tracking this type of company are through the S&P Dividend Aristocrats and the S&P High-Yield Dividend Aristocrats indexes, which track the performance of companies that have increased dividends for at least 25 years. The index is weighted according to each stock's yield.

RELATED TERMS
  1. S&P 500 Dividend Aristocrats

    Companies that have had an increase in dividends for 25 consecutive ...
  2. Forward Dividend Yield

    An estimation of a year's dividend expressed as a percentage ...
  3. Dividend

    A distribution of a portion of a company's earnings, decided ...
  4. Dividend Yield

    A financial ratio that shows how much a company pays out in dividends ...
  5. Indicated Yield

    The dividend yield that a share of stock would return based on ...
  6. Accelerated Dividend

    Special dividends paid by a company ahead of an imminent change ...
Related Articles
  1. Mutual Funds & ETFs

    The 4 Best Indexes for Dividends

    Learn about some of the biggest dividend indexes in the marketplace and which niche of the dividend universe each of these indexes targets.
  2. Chart Advisor

    Now Is The Time To Invest In The Dividend Aristocrats

    Given their incredible track record, the dividend aristocrats represent some of the most stable companies in the world.
  3. Stock Analysis

    3 Blue Chip Stocks with Fat Dividends

    Discover what factors go into determining a great dividend stock, and learn about three large, stable companies that offer above-average yields.
  4. Investing

    The Top 5 Companies Paying Dividends (JNJ, XOM)

    Explore analyses of the top five dividend-paying companies, and learn about their trailing 12-month dividend payouts and dividend payout ratios.
  5. Investing Basics

    6 Rules for Successful Dividend Investing

    Dividend investing is a smart way to build wealth but there are some important rules investors must remember in order to maximize value.
  6. Investing

    The 3 Biggest Misconceptions of Dividend Stocks

    To find the best dividend stocks, focus on total return, not yield.
  7. Options & Futures

    Stock-Picking Strategies: Income Investing

    Income investing, which aims to pick companies that provide a steady stream of income, is perhaps one of the most straightforward stock-picking strategies. When investors think of steady income ...
  8. Markets

    Due Diligence On Dividends

    Understanding dividends and how they work will help you become a more informed and successful investor.
  9. Stock Analysis

    The Top 5 Dividend Paying Oil Stocks for 2016

    Discover the top five dividend-paying oil companies for 2016 and what factors contribute to their ability to continue dividend payments.
  10. Investing Basics

    The Risks of Chasing High Dividend Stocks

    Dividend stocks offer enticing yields, but a lot can go wrong on the way to collecting that dividend payout.
RELATED FAQS
  1. What is the difference between yield and dividend?

    Learn how to differentiate between dividend yield and dividend return, and see why dividend yield is the more popular rate ... Read Answer >>
  2. What metrics should I evaluate when looking for high-yielding dividend stocks?

    Evaluate high-yield dividend stocks to determine if they are a good investment to produce steady income. Learn what questions ... Read Answer >>
  3. What is the difference between the dividend yield and the dividend payout ratio?

    Learn the differences between a stock's dividend yield and its dividend payout ratio, and learn why the latter might be a ... Read Answer >>
  4. Can dividends be paid out monthly?

    Find out if stocks can pay dividends monthly, and learn about the types of companies most likely to do so and how monthly ... Read Answer >>
  5. What can cause the marginal propensity to consume to change over time?

    Learn about the dividend payout ratio and dividend yield, what the ratios measure and the difference between the dividend ... Read Answer >>
  6. What types of companies offer the most dividends?

    Find out which types of companies tend to offer the most dividends, and learn why dividends must be considered carefully ... Read Answer >>
Hot Definitions
  1. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  2. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  3. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  4. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
  5. Generally Accepted Accounting Principles - GAAP

    The common set of accounting principles, standards and procedures that companies use to compile their financial statements. ...
  6. DuPont Analysis

    A method of performance measurement that was started by the DuPont Corporation in the 1920s. With this method, assets are ...
Trading Center