20 Years Of 10%+ Dividend Growth
Now is a great time to buy up quality dividend stocks.
The stock market is down about 6% from its highs in February.
But some stocks are down a lot more.
American Express (ticker: AXP), the popular credit card issuer, has been a member of the Dow Jones Industrial Average for more than 40 years.
It’s one of America’s great companies.
And one of Warren Buffett’s favorites… he owns about $50 billion of the company’s stock.
Unfortunately for Warren Buffett, American Express is down almost 20% in 2026.
But bad news for Warren is great news for us because we can buy the stock at a big discount.
American Express’s current dividend yield is 1.3%, which hasn’t been higher since last April.
The yield is low, but American Express really shines with dividend growth.
American Express has paid a dividend every year since 1989, and has raised its payments on average by 10% per year over the last 20 years.
Its dividend is doubling every 7 years!
Just because American Express has amazing dividend growth going back 20 years doesn’t mean the dividend has increased every year.
American Express paused dividend raises in 2008 because of the Great Recession and in 2020 because of the COVID-19 pandemic.
So when things are tough, expect American Express to pause dividend increases.
But when American Express does raise payments, they go up by a lot.
And it’s happening again.
American Express is raising its dividend to $0.95 every quarter, which is 15% higher than the last payment.
However, you need to act quickly.
You need to own American Express by April 1st (Wednesday) to collect the higher payment.
Don’t overlook the dividend payout ratio, especially for companies with high dividend growth.
American Express’s dividend payout ratio is only 21%, but here’s the best part.
Its dividend payout ratio has been around 20% every year for the past few years.
A stable dividend payout ratio means the company knows how to manage its cash, which is really important for dividend investors.
Plus, American Express is generating a ton of cash.
Last year, American Express generated over $16 billion in free cash flow.
And American Express’s free cash flow margin of 22% is one of the highest in the credit services industry.
Free cash flow margin is the percentage of revenue turned into free cash flow, so it’s really important for dividend stocks.
American Express is more than just the dividend though.
Its Return on Equity (ROE) of 34% is one of the highest in its industry.
And its earnings growth is outstanding.
Over the past decade, American Express is averaging almost 13% growth in its EPS each year.
What dividend stocks are you buying in the most recent downturn?
Michael Jennings. Editor
Dividend Stocks Research
Category: Dividend Stocks To Buy?
