Understanding International Dividend Aristocrats

British multinational consumer goods company.

International Dividend Aristocrats are a select group of companies that have consistently increased their dividend payouts for a significant number of years. These companies are not limited to the United States but are spread across various countries worldwide. This article will provide a comprehensive understanding of International Dividend Aristocrats, their criteria, and how they differ from U.S. Dividend Aristocrats.

Definition of International Dividend Aristocrats

International Dividend Aristocrats are companies based outside of the United States that have a track record of increasing their dividends each year for at least ten years. These companies are typically part of the S&P Global Broad Market Index (BMI) and are considered to be some of the most reliable dividend-paying stocks in the world.

Criteria for Being an International Dividend Aristocrat

The criteria for a company to be considered an International Dividend Aristocrat are:

1. The company must be part of the S&P Global BMI.
2. The company must have increased its dividend payout every year for at least ten years.
3. The company must meet certain market capitalization and liquidity requirements.

These criteria ensure that only companies with a strong financial position and a commitment to returning capital to shareholders are included in the International Dividend Aristocrats.

Differences Between U.S. and International Dividend Aristocrats

While both U.S. and International Dividend Aristocrats share the common trait of consistently increasing dividends, there are some key differences:

1. Length of Dividend Increase: U.S. Dividend Aristocrats are required to have increased their dividends for at least 25 consecutive years, while International Dividend Aristocrats only need a track record of 10 years.

2. Index Membership: U.S. Dividend Aristocrats are part of the S&P 500 Index, which includes large-cap U.S. companies. In contrast, International Dividend Aristocrats are part of the S&P Global BMI, which includes companies from developed and emerging markets worldwide.

3. Number of Companies: The International Dividend Aristocrats list is typically larger than the U.S. list due to the inclusion of companies from multiple countries.

Overview of Current International Dividend Aristocrats

The list of International Dividend Aristocrats includes a diverse range of companies from various sectors and countries. Some well-known International Dividend Aristocrats include Nestle (Switzerland), Unilever (UK/Netherlands), and Toyota Motor Corporation (Japan). These companies have demonstrated a commitment to shareholders by consistently increasing their dividends, even during challenging economic times.

In conclusion, International Dividend Aristocrats offer investors the opportunity to gain exposure to high-quality, dividend-growing companies outside of the United States. Understanding these companies and their characteristics is a crucial step towards diversifying your investment portfolio and potentially enhancing your dividend income.