Now’s The Time To Buy Dividend Royalty: Our Top Picks In Every Sector

Last week we looked over the Q1 earnings season to see where we are, and where we are projected to go. We found that some sectors are projected to do, um not so good for the remainder of 2025 and in 2026 as well. Today we are going to pick out a few potentially yummy investments in each sector. In uncertain markets, you want to find investments that have a strong history of dividend growth. We will look at a couple in each sector and look at their dividend growth streak, payout ratio, and other valuation metrics. Projected growth is a YOY projection for the next 3 to 5 years. Target price is the estimated high water mark for the stock in the next 12 months. Bold is the best of the sector’s dividend growers as of current data and needs to be researched further before you buy.

Materials:

  1. SON $45.03- 49 years of dividend growth. 4.68% yield. 13% projected growth. Target price $56. Payout ratio 397%.
  2. SCL $53.83- 57 years of dividend growth. 2.86% yield. 29% projected growth. Target price $85. Payout ratio 61%.
  3. FUL $54.83- 56 years of dividend growth. 1.72% yield. 14% projected growth. Target price $60. Payout ratio 44%.

Communications:

  1. CMCSA $34.59- 21 years of dividend growth. 3.76% yield. 8% projected growth. Target price $40. Payout ratio 31%.
  2. SSTK $18.55- 4 years of dividend growth. 7.37% yield. 6% projected growth. Target price $30. Payout ratio 89%.
  3. VZ $43.13- 20 years of dividend growth. 6.19% yield. 3% projected growth. Target price $48. Payout ratio 64%.

Consumer Cyclical:

  1. PII $38.30- 30 years of dividend growth. 6.83% yield. 100% projected growth. Target price $36.75. Payout ratio 368%.
  2. BBY $70.76- 20 years of dividend growth. 5.37% yield. 9% projected growth. Target price $86. Payout ratio 89%.

Consumer Defensive:

  1. ADM $47.96- 53 years of dividend growth. 4.25% yield. 18% projected growth. Target price $50. Payout ratio 71%.
  2. PEP $130.12- 52 years of dividend growth. 4.37% yield. 6% projected growth. Target price $151. Payout ratio 80%.
  3. MO $59.30- 55 years of dividend growth. 6.88% yield. 3% projected growth. Target price $58. Payout ratio 68%.
  4. UVV $58.60- 54 years of dividend growth. 5.6% yield. 2% projected growth. Target price $59. Payout ratio 158%.
  5. BTI $44.60- 10 years of dividend growth. 6.84% yield. 6% projected growth. Target price $47. Payout ratio 173%

Energy:

  1. EPD $31.39- 27 years of dividend growth. 6.82% yield. 7% projected growth. Target price $37. Payout ratio 79%.
  2. ENB $45.17- 30 years of dividend growth. 5.98% yield. 8% projected growth. Target price $45. Payout ratio 135%.
  3. CNQ $30.82- 25 years of dividend growth. 5.5% yield. 4% projected growth. Target price $35. Payout ratio 61%.
  4. KMI $27.34- 8 years of dividend growth. 4.28% yield. 7% projected growth. Target price $30. Payout ratio 100%.
  5. CVX $135.29- 38 years of dividend growth. 5.06% yield. 21% projected growth. Target price $162. Payout ratio 77%.

Financial:

  1. BEN $21.61- 45 years of dividend growth. 5.92% yield. 11% projected growth. Target price $20. Payout ratio 190%.
  2. TROW $94.96- 39 years of dividend growth. 5.38% yield. 2% projected growth. Target price $94. Payout ratio 58%.
  3. OZK $44.73- 44 years of dividend growth. 3.85% yield. 8% projected growth. Target price $51. Payout ratio 26%.
  4. LNC $32.67- 11 years of dividend growth. 5.51% yield. 6% projected growth. Target price $38. Payout ratio 26%.

Healthcare:

  1. SNY $52.51- 3 years of dividend growth. 4.21% yield. 10% projected growth. Target price $66. Payout ratio 75%.
  2. BMY $47.03- 16 years of dividend growth. 5.27% yield. -12% projected growth. Target price $57. Payout ratio 91%.
  3. PFE $23.04- 16 years of dividend growth. 7.47% yield. 3% projected growth. Target price $30. Payout ratio 122%.

Industrial:

  1. SWK $66.34- 57 years of dividend growth. 4.94% yield. 36% projected growth. Target price $86. Payout ratio 138%.
  2. MATW $20.80- 32 years of dividend growth. 4.81% yield. -31% projected growth. Target price $38. Payout ratio 113%.
  3. TRN $25.63- 16 years of dividend growth. 4.68% yield. 19% projected growth. Target price $28. Payout ratio 54%.
  4. UPS $96.97- 22 years of dividend growth. 6.76% yield. 14% projected growth. Target price $116. Payout ratio 95%.

Real Estate:

  1. FRT $93.66- 57 years of dividend growth. 4.7% yield. 9% projected growth. Target price $113. Payout ratio 126%.
  2. NNN $41.01- 35 years of dividend growth. 5.66% yield. 3% projected growth. Target price $44. Payout ratio 107%.
  3. UHT $37.91- 40 years of dividend growth. 7.76% yield. 8% projected growth. Target price $42. Payout ratio 217%. 

Technology:

  1. HPQ $28.50- 15 years of dividend growth. 4.06% yield. 5% projected growth. Target price $33. Payout ratio 40%.
  2. SWKS $70.36- 12 years of dividend growth. 3.98% yield. -17% projected growth. Target price $79. Payout ratio 108%.

Utilities:

  1. BKH $57.56- 55 years of dividend growth. 4.7% yield. 5% projected growth. Target price $66. Payout ratio 67%.
  2. ES $63.06- 27 years of dividend growth. 4.77% yield. 5% projected growth. Target price $70. Payout ratio 125%.
  3. POR $41.74- 18 years of dividend growth. 5.03% yield. 5% projected growth. Target price $48. Payout ratio 70%.
  4. UGI $35.59- 36 years of dividend growth. 4.21% yield. 1% projected growth. Target price $38. Payout ratio 60%.
  5. AES $9.63- 12 years of dividend growth. 7.31% yield. 4% projected growth. Target price $14. Payout ratio 38%.
  6. NWN $40.45- 69 years of dividend growth. 4.85% yield. 5% projected growth. Target price $48. Payout ratio 74%.

If you invested equally across all 11 sectors, you would have some serious dividend growth history (minus SSTK). You would also have a pretty conservative portfolio that yields 5.09% (if you invested in the highest yielding investment in each sector your yield would be 6.53% but sometimes the highest yield isn’t the best idea). You would also have investments that can afford to grow the dividend in the future (minus FRT) but also have investments that have room to run and appreciate your initial investment. Looking back at the earnings reports email we just did, we know energy, industrial, materials, consumer defensive, consumer discretionary, financial and utilities all are projected to have trouble the next 12-18 months with either growth or revenue growth so I would start looking at the stocks in those sectors first. We also know that communications, technology and health care are all projected to do quite nicely the next 12-18 months, so if you invest in these sectors I would make damn sure the valuation metrics are all met before buying. As I mentioned at the top, further research is necessary to determine if margins and revenue and debt all meet your criteria.

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