uploads///Dvd growth

Utility Stocks with the Highest Dividend Growth


Jan. 8 2019, Updated 10:30 a.m. ET

Dividend growth

In this part, we’ll discuss the S&P 500 Utilities with the highest dividend growth over the last five years. Utilities at large managed to raise their dividends per share by an average of ~4% in the last five years compounded annually. Competitive utility AES (AES) increased its dividend per share by more than 26% compounded annually during the same period. However, AES has a shorter dividend payment history. The company started paying shareholders in 2012. AES offers a dividend yield of 3.8%, which is higher than utilities’ average of 3.3%.

Article continues below advertisement

NextEra Energy

NextEra Energy (NEE), the biggest utility by market cap and the largest component of the Utilities Select Sector SPDR ETF (XLU), increased its dividend 11% in the last five years. NextEra Energy’s superior earnings growth has fueled its above-average dividend growth in the last few years. NextEra Energy yields 2.6%—one of the lowest yields among its peers.

Despite a lower yield, NextEra Energy outperformed broader utilities and even broader markets in the last several years. To learn how NextEra Energy achieved this feat, read These S&P 500 Utilities Have Delivered the Best Five-Year Returns.

In comparison, leading water utility American Water Works (AWK) has raised its dividend 10%, while California-based Edison International (EIX) reported a higher dividend growth of 12.4% in the last five years. American Water Works is trading at a yield of 2%, while Edison International offers a yield of 4.3%.


More From Market Realist

  • CONNECT with Market Realist
  • Link to Facebook
  • Link to Twitter
  • Link to Instagram
  • Link to Email Subscribe
Market Realist Logo
Do Not Sell My Personal Information

© Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.