Looking for dividend stocks with serious growth credentials? This screen might be your new favorite tool.
We’ve filtered the universe of small-cap stocks to find the rare breed that offers not just income, but rising income. Each of the 12 companies on this list pays a dividend yielding between 1.5% and 3.75%. Respectable, but not high enough to raise red flags about sustainability. More importantly, their dividends are growing and growing fast. Every stock here has increased its dividend at an average annual rate of more than 8% over the last 1, 3, and 5 years.
But that’s just the beginning. These companies also show strong earnings growth (8%+ average annual EPS growth over the last five years), prudent payout ratios (between 10% and 40%), and healthy top-line expansion (sales up at least 4% annually over five years). They’re not financial engineering stories. They’re businesses growing from the inside out.
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The market caps range from $30 million to $2 billion. Underfollowed, underappreciated, and, in many cases, undervalued. That’s exactly where long-term wealth is built. You’re not buying household names here. You’re buying tomorrow’s dividend champions before the market catches on.
Let’s get into the list.
As you can see, most of the stocks in this list are banks and other financial institutions. Banks tend to have a stable customer base and are able to grow responsibly.
Shoe Carnival is an interesting company and I am very positive about its prospects. The China tariffs are a headwind but hopefully it should be resolved soon.
LZB also appears to be nicely valued and could be a great stock to own going forward.
Use this list as a launchpad for deeper research before you decide to buy any of the stocks mentioned here.
