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The 5 Best Dividend Growth Stocks for the Rest of 2018

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Yield isn’t everything when it comes to dividend investing.

Indeed, a steady, rising payout is what leads to long-term capital appreciation. Dividend growth not only makes a stock more attractive to new income investors, but also rewards existing investors with increasingly higher yields on shares purchased at lower prices in the past. Additionally, dividend growth tends to be a sign of health, analysts say.

“Companies with the ability to consistently grow dividend payments tend to be strong franchises,” says Tony DeSpirito, portfolio manager for BlackRock’s equity dividend portfolios. “A healthy balance sheet and ample free cash flow provide the means to grow the dividend.”

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After running the numbers on all dividend payers among the 1,200 largest U.S. companies, analysts at Blockforce Capital (formerly Reality Shares) identified the best dividend growth stocks to buy now.

The company’s Divcon dividend-health rating system assesses the likelihood that companies will grow or cut their dividends in the next 12 months. Analyst Kian Salehizadeh says these are the top five dividend growth stocks for the fourth quarter based on the firm’s proprietary dividend growth data.

SEE ALSO: 53 Best Dividend Stocks for 2018 and Beyond

Data is as of Oct. 11, 2018, unless otherwise noted. Stocks are listed alphabetically. Dividend yields are calculated by annualizing the most recent quarterly payout and dividing by the share price. Five-year annualized dividend growth rates provided by Divcon. Analysts’ ratings provided by Zacks Investment Research.

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