Energy and industrial companies play a crucial role in driving the global economy. These sectors are responsible for producing the goods and services that we rely on every day, from electricity to automobiles to food products. With a global population exceeding 8 billion people, the demand for these products and services continues to grow, creating opportunities for companies in the energy and industrial sectors.
However, the economy is not always stable, and fluctuations can pose risks to energy and industrial stocks. Despite this, some companies have managed to navigate these challenges successfully, demonstrating resilience and adaptability. One key indicator of a company’s strength is its ability to consistently increase dividends over time.
Here are four companies that have a track record of dividend growth and are well-positioned to continue providing investors with pay raises for decades to come:
1. ExxonMobil: As a leading integrated oil and gas company, ExxonMobil plays a critical role in the global energy market. Despite the volatility of commodity prices, the company has managed to increase its dividend for 42 consecutive years. With a strong balance sheet and a diversified business model, ExxonMobil offers investors a starting dividend yield of 3.4%.
2. Illinois Tool Works: With a streak of 61 years of dividend growth, Illinois Tool Works is a Dividend King in the industrial sector. The company serves a wide range of markets, including automotive, food equipment, and construction products. Illinois Tool Works’ success is attributed to its diversification and prudent management, with a manageable debt ratio and a conservative dividend payout ratio of 52%.
3. Badger Meter: A lesser-known company in the flow and measurement technology sector, Badger Meter has been steadily increasing its dividend for 32 years. The company operates in industries such as water, energy, and agriculture, providing devices that measure liquid and gas flow. With a low dividend payout ratio of 30%, Badger Meter has room for continued dividend growth in the future.
4. NextEra Energy: As a major player in the renewable energy sector, NextEra Energy is positioned for long-term growth. The company is also the largest electric utility in America, serving millions of customers in Florida. With a 30-year track record of dividend growth, NextEra Energy is committed to raising its dividend by at least 10% annually through 2026. The company’s strong financial position, with a dividend payout ratio of 50%, provides a safety net for investors.
In conclusion, investing in energy and industrial companies with a history of dividend growth can provide investors with a reliable source of income and long-term growth potential. These four companies exemplify the resilience and stability that can be found in the energy and industrial sectors, making them attractive options for investors seeking decades of passive income.
