Dividend Aristocrats are stocks that have increased their dividends for 25 or more consecutive years. As of the end of 2020, there were 66 stocks in the S&P 500 Dividend Aristocrat index.
This is a highly exclusive list, limited to only some of the most successful businesses in existence. After all, you have to do so many things just right in order to pay out a growing dividend for decades on end. There are plenty of companies out there that aren’t even profitable, let alone able to pay a dividend.
A dividend growing like clockwork year in and year out? Forget about it. As you might imagine, Dividend Aristocrats tend to be excellent long-term investments. So excellent, in fact, that some of them have attracted the attention and capital of Warren Buffett himself.
Warren Buffett built a fortune of over $100 billion purely through investing, and that’s after giving away billions of dollars already. Buffett knows a thing or two about investing. And Dividend Aristocrats know a thing or two about consistently growing their profits and their dividends.
Today, I want to tell you about five Dividend Aristocrats that Warren Buffett is invested in via the common stock portfolio he manages within Berkshire Hathaway.
Ready? Let’s dig in.
Buffet Owned Dividend Aristocrat #1: AbbVie (ABBV)
The first Dividend Aristocrat I want to tell you about is AbbVie (ABBV). Warren Buffett’s got almost $3 billion invested in the biopharmaceutical company.
While AbbVie’s dividend growth track record as an independent business is technically not yet 25 consecutive years, their dividend growth track record actually dates back to the legacy Abbott Laboratories company they used to be a part of before being spun off in 2013.
AbbVie is a phenomenal business with the #1 selling pharmaceutical in the world – Humira.
With the stock yielding 4.7% and pumping out growing dividends like clockwork, it’s a fantastic long-term idea for dividend growth investors. We put out a video covering AbbVie and discussing its undervaluation back in November when the stock was $85/share.
It’s now $110/share. But Buffett clearly believes in it. And so do I.
Buffet Owned Dividend Aristocrat #2: Chevron (CVX)
The second Buffett-backed Dividend Aristocrat is Chevron (CVX). Warren Buffett has backed the oil giant to the tune of almost $5 billion.
Berkshire Hathaway has put some serious money to work here. Their 33 consecutive years of dividend raises, 5% yield, and 10-year dividend growth rate of 6.2% might have something to do with it.
The stock’s five-year average yield is just 4.3%, so there could still be an opportunity here.
Even after a run, Chevron remains a high-yielding Dividend Aristocrat gushing dividends almost as much as they gush oil.
Buffet Owned Dividend Aristocrat #3: Johnson & Johnson (JNJ)
Next up is Johnson & Johnson (JNJ).
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