Dividend Aristocrats: Reliable Stocks for Steady Income in 2024

Dividend Aristocrats are perfect for investors seeking long-term income, as well as steady income in 2024. But this one has to be the best.

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Investors must be so tempted right now. The TSX today continues to trade around all-time highs, but hasn’t pushed far past them. And this has caused a bunch of us to wait around, hoping soon we’ll see some growth in the near future.

But that can tempt many of us to get into growth stocks. When instead, Dividend Aristocrats should be where you put your long-term cash. So, let’s look at why and some stocks to consider.

Why Dividend Aristocrats

There are many compelling reasons to consider these stocks. Dividend Aristocrats are companies that have consistently increased dividends for many years, often decades. This consistent dividend growth makes them reliable sources of income, especially during uncertain economic times. For example, companies should have a long history of maintaining and increasing their dividends, providing investors with a steady and predictable income stream.

Furthermore, Dividend Aristocrats are typically well-established companies with strong financials and robust business models. Their ability to sustain and grow dividends over long periods indicates financial health and resilience. These companies often have solid balance sheets, significant cash reserves, and the ability to generate stable cash flows even in challenging market conditions.

These dividends that grow over time can act as a hedge against inflation. As the cost of living increases, rising dividend payments help maintain the purchasing power of investors’ income. This is particularly important in an inflationary environment where fixed-income investments may lose value in real terms.

Then, reinvesting dividends can significantly enhance total returns through the power of compounding. Dividend Aristocrats, with their regular and increasing payouts, provide opportunities for reinvestment, which can lead to substantial growth in the value of an investment portfolio over the long term. And with lower volatility, these companies have a long future ahead.

A stock to consider

There are, of course, many Dividend Aristocrats out there. But if you’re considering just one for now, let it be goeasy (TSX:GSY). goeasy stock has demonstrated a strong commitment to returning value to shareholders through consistent dividend growth. As a Dividend Aristocrat, the company has a track record of increasing its dividend payments annually. This consistent growth is a sign of financial health and stability, making it a reliable source of income for investors.

What’s more, goeasy has shown robust financial performance, reflected in its earnings and revenue growth. For instance, in the first quarter of 2024, the company reported revenues of $310 million, a significant increase from the previous year. This growth trajectory indicates the company’s ability to expand its market share and increase profitability.

Add to that, that goeasy stock operates in the consumer lending market, which has been experiencing steady growth. The company provides loans and other financial services to non-prime borrowers, a market segment that is underserved by traditional banks. This positioning allows goeasy to capitalize on the growing demand for alternative lending solutions.

Finally, goeasy stock’s business model is resilient, characterized by its focus on non-prime borrowers who require financing options outside of traditional banking. This focus provides a stable customer base with high demand for the company’s products and services. Additionally, goeasy’s ability to manage credit risk effectively has contributed to its strong financial performance.

Bottom line

Among Dividend Aristocrats, goeasy stock looks like the best. goeasy stock offers an attractive dividend yield, which enhances its appeal to income-focused investors. The company’s ability to consistently increase its dividend payout reflects its robust cash flow and profitability. As of the latest data, goeasy’s dividend yield is approximately 2.5%, providing a solid return for dividend investors.

Therefore, investors looking for reliable income and potential capital appreciation should consider goeasy as part of their investment strategy.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Amy Legate-Wolfe has positions in Goeasy. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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