VIG - All 133 Aristocrats Ranked By Dividend Safety

2023-04-21 07:50:00 ET

Summary

• Dividends soared in 2022 as companies saw earnings boosted by inflation.
• In 2023, despite a mild recession, dividends are expected to grow 5%.
• For those seeking maximum dividend safety in the likely downturn, dividend aristocrats are a great choice.
• All dividend aristocrats, including champions, kings, and global aristocrats, average 91% safety, a 1.63% risk of a dividend cut, 42-year growth streak, and BBB+ credit rating.
• This article ranks all 133 dividend aristocrats, champions, kings, and global aristocrats by safety score. Part 2 of this series will show you how to construct a high-yield aristocrat portfolio with the safest dividends for this recession.

This article was published on Dividend Kings on Tuesday, April 18th

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2022 was a pretty rough year for most investors.

The S&P (SP500) fell 18%, the Nasdaq (COMP.IND) fell over 20%, and the 60/40 retirement portfolio fell 16%.

It was a year of 8% inflation, a year when government bonds traded like crypto, including a 50% 2-day crash for UK 50-year bonds.

But do you know who won in 2022? Dividend investors, in the only way that mattered.

After two consecutive years of negative real wage growth, take a look at these inflation-crushing raises the dividend blue-chips handed out!

• Aristocrats - ProShares S&P 500 Dividend Aristocrats ETF ( NOBL ) 2.4%
• S&P 11%
• aristocrats and future aristocrats - Vanguard Dividend Appreciation Index Fund ETF Shares ( VIG ) 14%
• high-yield blue-chips- Schwab U.S. Dividend Equity ETF™ ( SCHD ) 18%
• Nick Ward's dividend portfolio 24%
• my family hedge fund 27%
• growth stocks - Schwab U.S. Large-Cap Growth ETF™ ( SCHG ) 28%.

Ok, that's pretty impressive, and those big fat, inflation-beating hikes are a nice reward for surviving the stagflationary bear market of 2022.

But what about 2023? What about the recession that the Fed says is coming this year?

Given that the Great Recession saw S&P dividends crash 25%, naturally income investors are nervous about even a "mild recession" like what the Fed, economists, and the bond market expect.

The good news is that currently economists are expecting the mildest recession in history, a peak decline of 0.6% and 2023 growth of 0.9%.

That's compared to a 0.4% contraction in 2001.

Recessions don't mean huge dividend cuts, not for most blue-chip portfolios.

What do analysts expect for dividends this year?

• aristocrats and future aristocrats +0%
• aristocrats +4.7%
• S&P +4.9%
• growth stocks +5.6%

Ok, so that's a lot less impressive, but given that we're likely going to be in a recession soon, it's pretty good...if it actually happens.

But what if you could sleep extra well at night in this recession, knowing that you don't just own dividend blue-chips, but the bluest of dividend blue-chips, the dividend aristocrats.

And what if you could know the risk of a dividend cut for each and every aristocrat? What if you could put together a small basket of the safest and most dependable aristocrats of all?

With dividends so safe that their average risk of a cut even in another Great Recession level downturn were 1%?

Well, this article is for you.

How Dividend Kings Safety Scores Work

The Dividend Kings Safety and Quality scores are based on a 3,000 point model that includes over 1,000 metrics.

Not just the standard balance sheet metrics, and payout ratios, and dividend growth streaks, all of which are very important.

We strive to predict 95% of all dividend cuts before they happen, by factoring in every kind of risk a company faces, including the ones S&P considers relevant to its credit ratings. In fact, we cover everything S&P has covered for over 20 years in every rating you've ever seen like:

• supply chain management
• crisis management
• cyber-security
• privacy protection
• efficiency
• R&D efficiency
• innovation management
• labor relations
• talent retention
• worker training/skills improvement
• occupational health & safety
• customer relationship management
• business ethics
• climate strategy adaptation
• sustainable agricultural practices
• corporate governance
• brand management.

Here is an example of the newest dividend aristocrat of 2023 (with this year's hike) Enterprise Products Partners ( EPD ).

EPD Safety Score

EPD is an example of a rock-solid dividend you can bet your retirement on.

So how do the aristocrats and dividend champions, including global aristocrats, score? Here are all 133 ranked in order of safest to least safe dividends.

All The Aristocrats Ranked By Dividend Safety

The dividend champions are indeed a wonderful group of companies with the following:

• 91% average safety
• 1.63% average severe recession dividend cut risk
• 2.6% very safe yield
• 8.13% long-term growth consensus
• 10.73% long-term total return consensus
• 41.8 year dividend growth streak
• 4.27% 30-year bankruptcy risk
• BBB+ stable credit rating

No ETF lets you buy all the champions, including aristocrats, kings, and global aristocrats.

• VIG Vs. VIGI: One Of These Is The Best Dividend Aristocrat ETF .

VIG is the closest thing you can find for an ETF.

But in my next article, I'll show you how to build the ultimate high-yield aristocrat ultra sleep-well-at-night portfolio for this recession.

Continued In " 12 Aristocrats That Will Leave You Drowning In Dividends. "

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