Investors looking for defensive companies paying big dividends are drawn to the Dividend Aristocrats and with good reason. The 66 companies that made the cut for the 2024 S&P 500 Dividend Aristocrats list have increased dividends (not just remained the same) for 25 years straight. But the requirements go even further, with the following attributes also mandatory for membership on the aristocrat’s list:

• Companies must be worth at least $3 billion each quarterly rebalancing.
• Average daily volume must be at least $5 million in transactions for every trailing three-month period at every quarterly rebalancing date.
• They must be a member of the S&P 500.

Here at 247 Wall St., we consistently emphasize the power of total return to our readers. This strategy can significantly boost your overall investing success. Total return is the combined increase in a stock’s value and dividends.

For example, if you buy a stock at $20 that pays a 3% dividend and goes up to $22 in a year, your total return is 13%. That is, 10% for the increase in stock price and 3% for the dividends paid.

We decided to screen the Dividend Aristocrats list for companies with the biggest total return potential for 2025, and four of the highest-yielding companies in the group are among our top ideas for the new year.

Why do we cover the Dividend Aristocrats?

S&P 500 companies that have paid and raised their dividends for 25 years or longer are the kind that growth and income investors want to buy and hold in stock portfolios forever. These stocks are mostly conservative, and should we see a dramatic market correction, they will likely keep their ground much better than volatile technology names.

Realty Income

This is an ideal stock for growth and income investors looking for a safer contrarian idea for 2025 that pays a whopping 5.65% dividend. Realty Income Corp. (NYSE: O) is an S&P 500 company that provides stockholders with dependable monthly income.

The company is structured as a REIT, and its monthly dividends are supported by the cash flow from over 15,540 real estate properties (including properties acquired in the Spirit merger in January 2024) owned under long-term lease agreements with commercial tenants.

The company has declared 644 consecutive common stock monthly dividends throughout its 55-year operating history and increased the dividend 123 times since Realty Income’s public listing in 1994. It is a top real estate member of the S&P 500 Dividend Aristocrats index

Franklin Resources

This company is a mutual fund powerhouse that pays a safe and secure 5.55% dividend. Franklin Resources Inc. (NYSE: BEN) is among the most prominent global money managers.

The firm markets mutual funds and institutional separate accounts under the Franklin, Templeton, and Mutual Series brands. At times, 50% of its sales are from outside the United States, an advantage given the maturing U.S. market.

Franklin Resources offers its products and services under these brands:

• Franklin
• Templeton
• Franklin Mutual Series
• Franklin Bissett
• Fiduciary Trust
• Darby
• Balanced Equity Management
• K2
• LibertyShares
• Edinburgh Partners

The 2023-2024 bull market has proven to be a solid tailwind for the company. While withdrawals from baby boomers may be a concern, the path forward for 2025 looks very solid.

Amcor

This Dividend Aristocrat makes sense as it produces always-needed products and pays a strong 4.83% dividend. Amcor PLC (NYSE: AMCR) manufactures and sells packaging products in Europe, North America, Latin America, Africa, and the Asia Pacific regions. The company operates through two segments.

The Flexibles segment provides flexible and film packaging products in food and beverage, medical and pharmaceutical, fresh produce, snack food, personal care, and other industries.

The Rigid Packaging segment offers rigid containers for a range of beverage and food products, including:

• Carbonated soft drinks
• Water
• Juices
• Sports drinks
• Milk-based beverages
• Spirits
• Beer
• Sauces
• Dressings
• Spreads
• Personal care items
• Plastic caps for various applications
  

Chevron

This integrated giant is a safer option for investors looking to position themselves in the energy sector. It has a sweet 4.03% dividend. Chevron Corp. (NYSE: CVX) engages in integrated energy and chemicals operations worldwide through its subsidiaries. The company operates in two segments.

The Upstream segment is involved in the following:

• Exploration, development, production, and transportation of crude oil and natural gas
• Processing, liquefaction, transportation, and regasification associated with liquefied natural gas
• Transportation of crude oil through pipelines and transportation, storage
• Marketing of natural gas, as well as operating a gas-to-liquids plant

The Downstream segment engages in:

• Refining crude oil into petroleum products
• Marketing crude oil, refined products, and lubricants
• Manufacturing and marketing renewable fuels
• Transporting crude oil and refined products by pipeline, marine vessel, motor equipment, and rail car
• Manufacturing and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives

Downstream also involves cash management, debt financing, insurance operations, real estate, and technology businesses.

Start the New Year With 5 Blue Chip Dividend Stocks With 6% and Higher Yields

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