3 High-Yield Dividend Champions to Buy Now


  • With long histories of dividend increases and impressive yields, these stocks are great picks for income investors.
  • ABM Industries (ABM): ABM Industries has increased its dividend for a whopping 55 consecutive years.
  • Eversource Energy (ES): The company has a sustainable dividend that we expect to grow from here.
  • Automatic Data Processing (ADP): ADP has increased its dividend for 55 years and currently yields 2.4%.
high-yield dividend champions - 3 High-Yield Dividend Champions to Buy Now

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The Dividend Champions have increased their dividends every year for at least 25 years in a row. With their long dividend growth track records, throughout all kinds of crises, including the pandemic, the Great Recession, and so on, the Dividend Champion stocks can make for good income investments for income investors. In this article, we’ll showcase three such stocks that are offering above-average dividend yields at current prices.

ABM Industries (ABM)

An array of electrical conduits are lined up in a row across the ceiling of a room.
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ABM Industries (NYSE:ABM) is an integrated facilities solutions business that offers services such as electrical and lighting, janitorial services and more.

The company beat the analyst consensus estimate when it reported its third-quarter results. The company announced that its revenues totaled $2.03 billion during the quarter, which was up 3% versus the previous year’s quarter and $20 million above estimates. The revenue performance was weaker than during the previous quarter, in which revenues had grown faster. ABM Industries was not able to translate its revenue growth into attractive earnings growth, as its EBITDA was flat from the previous year’s period.

ABM Industries was able to generate earnings per share (EPS) of 79 cents during the third quarter. Guidance for the current fiscal year, 2023, was updated and lowered. EPS is now expected in a range of $3.40 to $3.50 on an adjusted basis, with some synergies of the recent Able Services acquisition being built into that estimate.

ABM Industries’ EPS has compounded at 5% over the last decade. Profits have grown very consistently, as they have risen during every year of the last decade. The GCA Services acquisition has allowed the company to expand its foothold both within the United States and internationally, which comes with scale advantages for the company.

The company has increased its dividend for 55 years in a row, which makes ABM a Dividend King.

At current prices, the dividend yields 2.2%, but for someone seeking a resilient, crisis-proven dividend grower, ABM could be a great pick. Since shares trade below our fair value estimate right here, there is a good chance that ABM Industries will deliver 10% annual returns (or more) over the coming five years.

Eversource Energy (ES)

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Eversource Energy (NYSE:ES) is a diversified holding company with subsidiaries that provide regulated electric, gas and water distribution service in the northeast U.S. The company’s utilities serve more than 4 million customers after acquiring NStar’s Massachusetts utilities in 2012, Aquarion in 2017, and Columbia Gas in 2020.

On Nov. 6, 2023, Eversource Energy released its third-quarter results for the period ending Sept. 30, 2023. For the quarter, the company reported operating revenue of $2.79 billion, a decrease of 13.2% compared to $3.22 billion in the same quarter of last year. The company reported earnings of $339.7 million and EPS of 97 cents compared with earnings of $349.4 million and EPS of $1 in the prior year.

Eversource Energy has the goal to invest $21.5 billion in different projects (transmission, electric distribution) in the 2023 to 2027 timeframe, which will support its goal to be carbon neutral by 2030. Most notably, the company is planning to add 1,758 megawatts of offshore wind through a joint venture by 2025. The company reaffirmed its EPS growth ambition at a compound annual growth rate of 5% to 7% from 2023 through 2027, the same as for dividend growth.

We expect the company to grow EPS by 6% per year on average over the next five years. The company has a good earnings track record and will benefit from rate hikes, transmission investments and clean energy initiatives.

The company has a projected 2023 payout ratio of 62%, which indicates a sustainable dividend.

Automatic Data Processing (ADP)

In this photo illustration the stock market information of Automatic Data Processing, Inc. displays on a smartphone with the logo of Automatic Data Processing, Inc. ADP stock.
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Automatic Data Processing (NASDAQ:ADP) is one of the largest business services outsourcing companies in the world. The company provides payroll services, human resources technology and other business operations to more than 700,000 corporate customers. With 48 years of consecutive dividend increases, it is also a member of the Dividend Champions.

ADP posted first-quarter earnings on Oct. 25, 2023, and results were mixed. The company beat on the bottom line, but fractionally missed the top line. Adjusted EPS came to $2.08, which was 6 cents better than expected. Revenue was up 7% year-over-year to $4.5 billion but missed estimates by $10 million. Employer Services grew 9%, which was driven by strong new business bookings and retention, as well as higher client funds interest revenue.

PEO Services revenue rose 3% with new business bookings growth, but margins fell 90 basis points. This was due partly to workers’ compensation reserve adjustments and higher selling costs. Total expenses were up 7.4% to $3.48 billion.

Beyond 2023, we believe the company is capable of delivering 8% annualized growth in EPS over full economic cycles. Much of this growth is likely to be driven by the company’s Professional Employer Organization (PEO) Services segment, which continues to deliver very impressive revenue growth.

Importantly, this revenue growth has been accompanied by meaningful margin expansion, which means that the segment’s growth has had an outsized impact on the firm’s bottom line. In addition, the company’s buyback has been a low single-digit tailwind annually for EPS growth in the past decade, and we expect that will continue moving forward.

ADP has increased its dividend for 55 years and currently yields 2.4%.

On the date of publication, Bob Ciura did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Bob Ciura has worked at Sure Dividend since 2016. He oversees all content for Sure Dividend and its partner sites. Prior to joining Sure Dividend, Bob was an independent equity analyst. His articles have been published on major financial websites such as The Motley Fool, Seeking Alpha, Business Insider and more. Bob received a bachelor’s degree in Finance from DePaul University and an MBA with a concentration in investments from the University of Notre Dame.

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