Wed. Dec. 15, 2010

The 2011 Dividend Aristocrats *

The S&P 500 Dividend Aristocrats is the most prestigious list of dividend stocks. The Dividend Aristocrats index is designed to measure the performance of S&P 500 constituents that have followed a policy of consistently increasing dividends every year for at least 25 consecutive years. This index is a member of the S&P Dividend Aristocrats index series.

Dividend Aristocrats constituents exhibit the following characteristics:

– Underlying Indices – S&P 500
– Weighting – Equally weighted; Constituents re-weighted quarterly
– Reconstitution – Reviewed annually in December

Among others, Dividend Aristocrats include these highly recognizable names, with years of consecutive dividend increases shown:

3M Co. (MMM) – 52 years
Abbott Laboratories (ABT) – 38 years
Clorox Co (CLX) – 35 years
Coca-Cola Co (KO) – 48 years
Exxon (XOM) – 28 years
Johnson & Johnson (JNJ) – 48 years
McDonald’s Corp (MCD) – 34 years
Procter & Gamble (PG) – 54 years
Wal-Mart Stores (WMT) – 36 years

Members may be deleted during the December rebalance if calendar-year dividends did not increase from the previous year, or intra-year if the stock is removed from the underlying S&P 500.

On December 2nd, S&P announced changes to the Dividend Aristocrats Index. Standard & Poor’s will perform the annual reconstitution of the S&P 500 Dividend Aristocrats Index after the close of trading on Friday, December 17, 2010.

The following stocks will be added to the Dividend Aristocrats:

– McCormick & Company (MKC)
– Hormel Foods Corp. (HRL)
– Ecolab Inc. (ECL)

The following stocks will be dropped from the Dividend Aristocrats:

– Eli Lilly And Company (LLY)
– Integrys Energy Group, Inc. (TEG)

After last year’s significant decline, it is good see the membership number level off. The previous two years were difficult for dividend stocks, but that is not necessarily a bad thing. During good times it is easy for companies to increase dividends, and many companies were added to the index. It is during times of adversity that we learn who the real aristocrats are.

Full Disclosure: Long MMM, ABT, CLX, KO, JNJ, LLY, MCD, PG, TEG, WMT. See a list of all my income holdings here.

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2 Responses to “The 2011 Dividend Aristocrats *”

  1. harold says:

    what are the total number of stocks in the Div. Aristocrats after the deletions and additions. Is it 12 stocks. if more can you please give the complete list for 2011

  2. D4L says:

    harold: I believe the number of dividend Aristocrats are around 42. You can go to my Stock Ideas page (click here) and search on the word Aristocrat.

    Best Wishes,