3 stocks that have paid dividends for more than 100 years
Nowadays, building wealth is a major financial goal for many people. While gold, bonds, real estate or oil may be considered solid investments, there is one type of investment that outperforms all others in the long run - dividend stocks.
Not only do these stocks generate regular income, but they have also historically delivered higher returns than most other investment classes. In this article, we'll take a look at why dividend stocks are ideal for building wealth and introduce three companies with a long history of paying dividends that should be on your investment radar.
The most effective way to build wealth?
Dividend stocks have proven to be one of the best ways to build a lucrative retirement portfolio. Unlike stocks that don't pay dividends, dividend stocks generate much higher yields. For example, according to a JPMorgan Chase study that compared the performance of dividend and non-dividend stocks, dividend-paying stocks produced an annual return of 9.5% between 1972 and 2012, while non-dividend stocks yielded just 1.6% annually.
Moreover, over the past 90 years, dividends have accounted for 41% of the total return of the S&P 500 Index, clearly showing the important role dividend stocks play in building long-term wealth.
The best dividend stocks with a history of over 100 years 👇
York Water $YORW+0.1%
York Water Company is a company that has earned a well-deserved reputation not only for its long history, but also for the stability it offers its shareholders. Founded in 1816, York Water is the oldest investor-owned water company in the United States. The company provides clean drinking water and wastewater services to 55 communities in south central Pennsylvania. Although at first glance it might appear to be an unassuming regional company, York Water is a real treasure for investors.
The secret to the company's success is its ability to generate steady and predictable income, which is the main reason it has become a favorite among conservative investors. York Water has been paying dividends continuously for 208 years, making it the oldest publicly traded company in the world that has not stopped paying dividends even in the most difficult times, such as world wars, economic crises and pandemics.
York Water's dividend may not be the highest on the market, at around 2.2% per annum, but its stability and reliability are undeniable. If we look at the performance of York Water's shares over the last 25 years, the company has delivered a total return to its investors in excess of hundreds of percent.
Colgate-Palmolive $CL-1.1%
Colgate-Palmolive is a global giant that has deep roots going back to the early 19th century. Founded in 1806, the company originally focused on soap and candles. Today, Colgate-Palmolive is best known for its consumer products that are part of the daily lives of millions of people around the world. Some of the best known products include Colgate toothpastes, Palmolive soaps, Speed Stick deodorants and Ajax cleaning products.
Colgate began paying dividends in 1895, which means its shareholders can count on a regular income for more than 125 years. What's even more remarkable, however, is the fact that Colgate has increased its dividend every year since 1964, placing it among an elite group of so-called Dividend Kings - companies that have continuously increased their dividend for at least 50 years. This performance is a testament to the financial strength and stability of the company, which has been able to generate sufficient earnings even in difficult economic conditions.
Over the past 10 years, Colgate-Palmolive's average annual dividend growth has been around 3.5%, demonstrating the company's commitment to its shareholders. Although dividend growth may not be as dynamic as some other companies, Colgate offers investors stability and reliability, which are key attributes for long-term investors.
3M $MM+0.4%
3M
MMM3M is a company that has a rich history of innovation and is known for its widely used products such as Post-it notes, Scotch tape, and many other industrial, consumer, and medical products. The company was founded in 1902 and has since grown to become one of the largest industrial conglomerates in the world. 3M is also known for its commitment to shareholders, as evidenced by its more than 100-year history of paying dividends.
Although 3M has long been regarded as one of the Dividend Kings, having increased its dividend every year for more than 60 years, a major turnaround occurred in 2023. The company decided to cut its dividend in half due to mounting legal and regulatory issues, ending its long-standing record of dividend growth. This decision was made at a time when the company faced significant challenges, including extensive litigation related to health and environmental issues, which significantly impacted its financial stability.
Despite the dividend cut, 3M continues to pay dividends, reflecting its commitment to maintaining its reputation as a reliable dividend payer. The company has also taken steps to improve its financial position, including spinning off its Solventum healthcare division, which was considered a key growth engine. Once 3M has dealt with its current problems, it is possible that it will return to regular dividend increases, which could once again make it a favorite of dividend investors.
Disclaimer: There is plenty of inspiration to be found on Bulios, but stock selection and portfolio construction is up to you, so always do a thorough analysis of your own.
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