10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (2024)

10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (1)

DividendChampions with low payout ratios and small debt figures originally published atlong-term-investments.blogspot.com. Dividend Champions are stockswith a very long history of consecutive dividend hikes. They have achieved toboost dividends year over year for more than 25 years without an interruption.

Only105 stocks have managed this very important goal for long-term dividend growthinvestors. I like those stocks but some of them have a really high dividend payoutratio.

Earlier,I talked about the importance of the dividend growth rate and that it would be betterto buy lower yielding stocks with a much higher growth rate than stocks with verybig yields. Two main criteria for future dividend growth are the debt ratiosand dividend payout figures.


Thismonth, I started an article serial about dividend stocks with potential toboost dividends. Today I would like to present you Dividend Champions with thelowest dividend payouts. Only 10 income growth firms have a payout ratio of less than 20percent. Seven of them are currently recommended to buy.


Mostof them are modestly leveraged. Not low but also not too high but the rightleverage ratio is also a question of the business model and the strongcash-flow of a corporate as well as the costs for growth.


Here the top yielding stocks:
If you would like to receive more dividend stock ideas andthe free Dividend Weekly, you should subscribe to my free e-mail list.Alternatively, you can follow meonFacebookorTwitter.

Helmerich & Payne (NYSE:HP) has a market capitalization of $7.85 billion. The company employs 9,410 people, generates revenue of $3.151 billion and has a net income of $573.61 million. Helmerich & Payne’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1.277 billion. The EBITDA margin is 40.55 percent (the operating margin is 28.86 percent and the net profit margin 18.20 percent).


Financial Analysis:The total debt represents 4.11 percent of Helmerich & Payne’s assets and the total debt in relation to the equity amounts to 6.13 percent. Due to the financial situation, a return on equity of 16.08 percent was realized by Helmerich & Payne. Twelve trailing months earnings per share reached a value of $6.57. Last fiscal year, Helmerich & Payne paid $0.28 in the form of dividends to shareholders.

Market Valuation:Here are the price ratios of the company: The P/E ratio is 11.21, the P/S ratio is 2.43 and the P/B ratio is finally 1.98. The dividend yield amounts to 2.78 percent and the beta ratio has a value of 1.30.

10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (2)
Long-Term Stock Price Chart Of Helmerich & Payne (HP)
10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (3)
Long-Term Dividend Payment History of Helmerich & Payne (HP)
10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (4)
Long-Term Dividend Yield History of Helmerich & Payne (HP)


AFLAC (NYSE:AFL) has a market capitalization of $29.64 billion. The company employs 8,673 people, generates revenue of $25.364 billion and has a net income of $2.866 billion. AFLAC’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $5.747 billion. The EBITDA margin is 22.66 percent (the operating margin is 16.96 percent and the net profit margin 11.30 percent).

Financial Analysis:The total debt represents 3.32 percent of AFLAC’s assets and the total debt in relation to the equity amounts to 27.24 percent. Due to the financial situation, a return on equity of 19.82 percent was realized by AFLAC. Twelve trailing months earnings per share reached a value of $7.20. Last fiscal year, AFLAC paid $1.34 in the form of dividends to shareholders.

Market Valuation:Here are the price ratios of the company: The P/E ratio is 8.85, the P/S ratio is 1.16 and the P/B ratio is finally 1.85. The dividend yield amounts to 2.21 percent and the beta ratio has a value of 2.17.

10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (5)
Long-Term Stock Price Chart Of AFLAC (AFL)
10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (6)
Long-Term Dividend Payment History of AFLAC (AFL)
10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (7)
Long-Term Dividend Yield History of AFLAC (AFL)


McGraw Hill Financial (NYSE:MHFI) has a market capitalization of $18.17 billion. The company employs 21,687 people, generates revenue of $4.450 billion and has a net income of $726.00 million. McGraw Hill Financial’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1.401 billion. The EBITDA margin is 31.48 percent (the operating margin is 27.21 percent and the net profit margin 16.31 percent).

Financial Analysis:The total debt represents 17.81 percent of McGraw Hill Financial’s assets and the total debt in relation to the equity amounts to 163.75 percent. Due to the financial situation, a return on equity of 59.43 percent was realized by McGraw Hill Financial. Twelve trailing months earnings per share reached a value of $2.63. Last fiscal year, McGraw Hill Financial paid $1.02 in the form of dividends to shareholders.

Market Valuation:Here are the price ratios of the company: The P/E ratio is 25.06, the P/S ratio is 4.12 and the P/B ratio is finally 24.24. The dividend yield amounts to 1.68 percent and the beta ratio has a value of 1.09.

10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (8)
Long-Term Stock Price Chart Of McGraw Hill Financial (MHFI)
10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (9)
Long-Term Dividend Payment History of McGraw Hill Financial (MHFI)
10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (10)
Long-Term Dividend Yield History of McGraw Hill Financial (MHFI)


Dover (NYSE:DOV) has a market capitalization of $15.18 billion. The company employs 35,000 people, generates revenue of $8.104 billion and has a net income of $833.12 million. Dover’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1.798 billion. The EBITDA margin is 22.19 percent (the operating margin is 15.61 percent and the net profit margin 10.28 percent).

Financial Analysis:The total debt represents 26.81 percent of Dover’s assets and the total debt in relation to the equity amounts to 56.92 percent. Due to the financial situation, a return on equity of 16.92 percent was realized by Dover. Twelve trailing months earnings per share reached a value of $5.32. Last fiscal year, Dover paid $1.33 in the form of dividends to shareholders.

Market Valuation:Here are the price ratios of the company: The P/E ratio is 16.71, the P/S ratio is 1.90 and the P/B ratio is finally 3.20. The dividend yield amounts to 1.66 percent and the beta ratio has a value of 1.31.

10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (11)
Long-Term Stock Price Chart Of Dover (DOV)
10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (12)
Long-Term Dividend Payment History of Dover (DOV)
10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (13)
Long-Term Dividend Yield History of Dover (DOV)

Take a closer look at the full list of Dividend Champions with lowest dividend payout ratios. The average P/E ratio amounts to 18.14and forward P/E ratio is 15.30. The dividend yield has a value of 1.49 percent.Price to book ratio is 4.69 and price to sales ratio 2.06. The operating marginamounts to 19.19 percent and the beta ratio is 1.29. Stocks from the list havean average debt to equity ratio of 0.49.

Here is the full table withsome fundamentals (TTM):

10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (14)
Dividend Champions With Low Payout Ratios (Click to enlarge)

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Related Stock Ticker Symbols:

HP, AFL, MHFI,DOV, FDO, PPG, SCL, NDSN, FUL, BEN

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*Ihave no positions in any stocks mentioned, and no plans to initiate anypositions within the next 72 hours. I receive no compensation to write aboutany specific stock, sector or theme.

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10 Dividend Champions With Very Low Payout Ratios - The Next Big Dividend Grower? (2024)

FAQs

Who are the next dividend kings in 2024? ›

Out of more than 4,000 public companies in the U.S., just 54 make the cut in 2024, including five newly minted dividend kings: Archer Daniels Midland (ADM), Fortis (FTS), Kenvue (KVUE), RPM International (RPM), and United Bankshares (UBSI).

What is a low dividend payout ratio? ›

A lower payout ratio can sometimes indicate that the dividend is "healthy" -- there is a margin of safety that would allow a company to miss its earnings target and still be able to pay out its dividend, and there may also be room for management to increase the dividend over time.

What are the cheapest stocks that pay the highest dividends? ›

Invest in stocks, fractional shares, and crypto all in one place.
  • Granite Ridge Resources Inc. (GRNT)
  • LXP Industrial Trust (LXP)
  • Medical Properties Trust (MPW)
  • NatWest Group PLC (NWG)
  • Prospect Capital Corp. (PSEC)
  • Telefónica S.A. (TEF)
  • Valley National Bancorp (VLY)
May 15, 2024

What is a good payout ratio for a dividend stock? ›

Generally speaking, a dividend payout ratio of 30-50% is considered healthy, while anything over 50% could be unsustainable.

Which stock pays the highest dividend in 2024? ›

Some of the highest dividend paying stocks in India are Vedanta Ltd., Hindustan Zinc Ltd, Coal India Ltd, T.V. Today Network Ltd, Bhansali Engineering Polymers Ltd, Balmer Lawrie Investment Ltd, Coal India Ltd.

Which company gives the highest dividend in the world? ›

World's companies with the highest dividend yields
SymbolExchangeDiv yield % (indicated)
EEWINT DMYX88.64%
88031 DHKEX79.37%
SRAG DFWB74.29%
FFORTISMLR DBSE64.44%
27 more rows

Is a lower dividend payout ratio better? ›

Growth investors generally prefer a smaller dividend payout ratio because it means earnings are getting reinvested in the company. That reinvestment can fund new company segments or go into share-buyback programs.

What is a bad payout ratio? ›

If a company's payout ratio is over 100%, it returned more money to shareholders in the year it earned and may be forced to lower the dividend or stop paying it altogether since overpayment is likely to be unsustainable. A company may endure a bad year without suspending payouts.

Is it better for a company to have a higher or lower dividend payout ratio? ›

Fast Fact. A company that pays out greater than 50% of its earnings in the form of dividends may not raise its dividends as much as a company with a lower dividend payout ratio. Thus, investors prefer a company that pays out less of its earnings in the form of dividends.

What are the three dividend stocks to buy and hold forever? ›

The Motley Fool has positions in and recommends JPMorgan Chase, Realty Income, Vanguard Whitehall Funds - Vanguard High Dividend Yield ETF, and Vici Properties.

What is the best dividend stock of all time? ›

Some of the best dividend stocks include Johnson & Johnson (NYSE:JNJ), The Procter & Gamble Company (NYSE:PG), and AbbVie Inc (NYSE:ABBV) with impressive track records of dividend growth and strong balance sheets.

What is the safest dividend stock? ›

Even the best companies can see their stock prices plummet along with the broader market even if their long-term investment theses remain intact. Here's why Caterpillar (NYSE: CAT), Procter & Gamble (NYSE: PG), and Home Depot (NYSE: HD) stand out as three dividend stocks worth buying during a market correction.

What is the difference between dividend yield and payout ratio? ›

Dividend Yield vs. Payout Ratio: What is the Difference? Another popular metric for investors is the dividend payout ratio. While the dividend yield is the rate of return of dividends paid to shareholders, the dividend payout ratio is how much of a company's earnings are paid out as dividends instead of being retained.

What is the average dividend payout ratio for the S&P 500? ›

Basic Info. S&P 500 Dividend Yield is at 1.35%, compared to 1.47% last month and 1.66% last year. This is lower than the long term average of 1.84%.

What is the payout ratio for Apple? ›

Dividend Data

Apple Inc.'s ( AAPL ) dividend yield is 0.52%, which means that for every $100 invested in the company's stock, investors would receive $0.52 in dividends per year. Apple Inc.'s payout ratio is 15.08% which means that 15.08% of the company's earnings are paid out as dividends.

What stocks pay dividends in April 2024? ›

3 Dividend Stocks for April 2024
  • Altria MO.
  • J.P. Morgan Chase JPM.
  • FMC FMC.
Apr 8, 2024

How do you find the next dividend? ›

Dividend declarations often accompany earnings announcements. Existing shareholders receive the declaration information directly from the company, usually by a notice in the mail. Investing information websites regularly publish upcoming ex-dividend dates, along with the amount of the dividend.

Which is better, dividend kings or aristocrats? ›

Dividend aristocrats consistently increase their shareholder payouts year after year for at least 25 consecutive years. Some dividend aristocrats are also dividend kings, which have increased payouts for 50 consecutive years.

What dividend kings have beat the S&P 500? ›

Winners keep on running. Procter & Gamble (NYSE: PG) and Walmart (NYSE: WMT) are the only Dow Dividend Kings beating the S&P 500 in 2024. Interestingly enough, they are also the best-performing Dow Dividend Kings over the last year, three-year, five-year, and 10-year periods.

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