In this article, we discuss 12 high growth dividend stocks to buy. You can skip our detailed analysis of dividend stocks and their performance over the years, and go directly to read 5 High Growth Dividend Paying Stocks To Buy.
Among some investors, there's a perception or concern that allocating funds toward dividend payouts might limit a company's ability to reinvest in its operations or growth initiatives. However, there might not be a trade-off between higher dividends and increased profit growth, as reported by Newton Investment Management. In fact, giving dividends could encourage companies to manage their funds more wisely. In their paper titled Surprise! Higher Dividends = Higher Earnings Growth, Robert D. Arnott and Clifford S. Asness found a positive relationship between how much a company pays in dividends and its future earnings growth in the US market over seven decades until 2001. This suggests that paying dividends promotes better control over capital, potentially leading to stronger long-term returns. Additionally, companies that generate high returns on invested capital (ROIC) and carefully reinvest their capital are more likely to sustain a healthy and growing dividend. The report highlighted research by Conover et al. (2016), which conducted an extensive empirical study spanning more than five decades, from 1962 to 2014, using US market data. Their research revealed that investing in stocks that pay dividends not only boosts returns but also notably diminishes the risk associated with both value and growth portfolios. This outcome held true across various market capitalizations, indicating that the benefits of investing in dividend-paying stocks extend beyond specific sectors or company sizes.
When examining the broader scope of dividend stocks without isolating their performance to specific periods, it becomes evident that dividends consistently play a significant role in contributing to the overall market returns. Dividends have played a significant role in stock market returns, contributing to 40% of the total returns since 1930 and rising to 54% during periods of high inflation. Particularly during these inflationary times, stocks that consistently raised their dividends outpaced the overall market performance. Moreover, dividend payments can serve as a stabilizing force, potentially reducing the overall volatility in a stock's total return. This stability often appeals to investors looking for steadier income streams and less fluctuation in their investment portfolios.
The Procter & Gamble Company (NYSE:PG), Colgate-Palmolive Company (NYSE:CL), and PepsiCo, Inc. (NASDAQ:PEP) are some of the best dividend stocks that have shown strong growth over the years. In this article, we will take a look at some high growth stocks that pay dividends to shareholders.
12 High Growth Dividend Paying Stocks To Buy
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Our Methodology:
To make this list, we looked for companies that pay dividends and have seen their revenue grow by more than 15% compared to the same quarter of the previous year. This way, we wanted to find companies that not only share their profits with investors but also demonstrate significant and consistent growth in their earnings each quarter. The stocks are ranked in ascending order of their quarterly revenue growth on a year-over-year basis.
L3Harris Technologies, Inc. (NYSE:LHX) is a multinational defense technology company that operates in various segments of the defense and aerospace industries. In the third quarter of 2023, the company reported revenue of $4.9 billion, which showed a 15.8% growth from the same period last year. Its operating cash flow for the quarter came in at $543 million and its adjusted free cash flow amounted to $635 million. During the quarter, the company returned $216 million to shareholders through dividends.
L3Harris Technologies, Inc. (NYSE:LHX) currently offers a quarterly dividend of $1.14 per share and has a dividend yield of 2.21%, as of December 15. The company has been raising its dividends for 22 consecutive years.
The number of hedge funds tracked by Insider Monkey owning stakes in L3Harris Technologies, Inc. (NYSE:LHX) grew to 44 in Q3 2023, from 35 in the previous quarter. The collective value of these stakes is over $852.5 million.
Mondelez International, Inc. (NASDAQ:MDLZ) is a multinational food and beverage company that focuses on manufacturing and distributing a wide range of snack foods and beverages. On December 8, the company declared a quarterly dividend of $0.425 per share, which was in line with its previous dividend. Overall, the company has been raising its dividends consistently for 10 years. As of December 15, the stock has a dividend yield of 2.40%.
In the third quarter of 2023, Mondelez International, Inc. (NASDAQ:MDLZ) reported revenue of $9.03 billion, which showed a 16.3% growth on a year-over-year basis. It is one of the best high growth stocks on our list.
At the end of Q3 2023, 51 hedge funds in Insider Monkey's database owned stakes in Mondelez International, Inc. (NASDAQ:MDLZ), compared with 55 in the previous quarter. The collective value of these stakes is over $1.33 billion. Among these hedge funds, Holocene Advisors was the company's leading stakeholder in Q3.
Sun Life Financial Inc. (NYSE:SLF) is a Canadian financial services organization that provides a diverse range of insurance, wealth, and asset management solutions to individuals and corporate clients globally. On November 13, the company declared a quarterly dividend of C$0.78 per share, having raised it by 4%. This marked the company's eighth consecutive year of dividend growth. The stock's dividend yield on December 15 came in at 4.42%.
At the end of September 2023, 12 hedge funds owned stakes in Sun Life Financial Inc. (NYSE:SLF), up from 11 in the previous quarter. The total value of these stakes is more than $50.7 million. Waratah Capital Advisors was one of the company's leading stakeholders in Q3.
VICI Properties Inc. (NYSE:VICI) is a New York-based real estate investment trust company that primarily focuses on the acquisition, ownership, and leasing of gaming, hospitality, and entertainment properties. It is one of the best high growth stocks on our list as the company showed a 20.3% year-over-year growth in its revenue in the most recent quarter at $904.3 million. During the quarter, the company returned $422 million to shareholders in dividends.
VICI Properties Inc. (NYSE:VICI) has been growing its dividends for six consecutive years and it pays a quarterly dividend of $0.415 per share. The stock offers a dividend yield of 5.20%, as of December 15.
As of the close of Q3 2023, 33 hedge funds tracked by Insider Monkey owned stakes in VICI Properties Inc. (NYSE:VICI), compared with 40 in the preceding quarter. The consolidated value of these stakes is roughly $890 million.
NextEra Energy Partners, LP (NYSE:NEP) is a renewable energy company that focuses on owning, operating, and acquiring clean energy projects. The company reported a significant 21.5% year-over-year growth in its revenue in the third quarter of 2023 at $367 million. This makes NEP one of the best high growth stocks on our list.
NextEra Energy Partners, LP (NYSE:NEP) has been raising its dividends every quarter since 2015 and currently pays a quarterly dividend of $0.8675 per share. The stock has a dividend yield of 11.35%, as of December 15.
As of the close of the third quarter of 2023, 19 hedge funds in Insider Monkey's database owned investments in NextEra Energy Partners, LP (NYSE:NEP), down slightly from 23 in the previous quarter. These stakes are collectively valued at roughly $191 million.
JPMorgan Chase & Co. (NYSE:JPM) is next on our list of the high growth stocks that pay dividends. The American multinational financial services company currently offers a quarterly dividend of $1.05 per share and has a dividend yield of 2.56%, as of December 15. In the third quarter of 2023, the company generated nearly $40 billion in revenues, which showed a 21.90% growth from the same period last year.
As of the end of Q3 2023, 109 hedge funds in Insider Monkey’s database owned stakes in JPMorgan Chase & Co. (NYSE:JPM), up from 106 a quarter earlier. The consolidated value of these stakes is more than $6.6 billion. With over 11.3 million shares, Fisher Asset Management was the company's leading stakeholder in Q3.
Realty Income Corporation (NYSE:O) is one of the best high growth stocks on our list as the company showed a 24.2% year-over-year revenue growth in the most recent quarter. The American real estate investment trust company generated $1.04 billion in revenues in the third quarter of 2023, which also beat analysts' estimates by $84.2 million.
On December 12, Realty Income Corporation (NYSE:O) declared a 0.2% hike in its monthly dividend at $0.2565 per share. The company has raised its dividends for consecutive 104 quarters, which is also its 122nd increase in the amount of its dividends since the company's IPO in 1994. The stock has a dividend yield of 5.32%, as of December 15.
At the end of Q3 2023, 23 hedge funds in Insider Monkey's database owned stakes in Realty Income Corporation (NYSE:O), compared with 24 in the preceding quarter. These stakes have a total value of roughly $150 million.
