Formula
Consecutive dividend years = years of dividends paid without a gap
It is less a formula than a count of the dividend payment record.
Definition
Consecutive dividend years count how many years in a row a company has paid a dividend without interruption. If dividend yield looks at how much is paid now and the payout ratio at how much is paid relative to earnings, consecutive dividend years add the time axis: how steady that dividend has been.
Not skipping a dividend for a long time means the company has earned profits steadily over many years and has kept a policy that values returns to shareholders. If it maintained the dividend even in bad years for the economy, that is evidence its earnings and finances were stable.
The concept is especially well developed overseas. Companies that have raised their dividends for 25 years or more are called Dividend Aristocrats, and those at 50 years or more Dividend Kings. Jupick reads consecutive dividend years in the dividends area together with dividend yield and the payout ratio.
How to read it
In general, more consecutive dividend years are read as a steadier, more stable dividend policy. In Jupick's strengths and weaknesses summary, five or more consecutive years of dividends are generally shown as a strength.
Consecutive dividends show both a company's attitude toward dividends and the stability of its earnings. That is why a steady dividend that has continued for a long time earns more trust, in terms of dividend quality, than a high dividend over a short period.
A long record is a record of the past, though. Having been steady so far is no assurance that it continues in the same way, so recent earnings and the payout ratio need to be checked too.
Consecutive dividend years across the market now
The values that fall at each point when the stocks Jupick covers are lined up by Consecutive dividend years, smallest to largest. Positions in the line are used instead of an average because a few unusually large values can drag a single average a long way.
KoreaBased on 199 stocks
| Lowest 25% | Middle | Highest 25% |
|---|---|---|
| 1 yrs | 7 yrs | 11 yrs |
Smallest value 0 yrs, largest value 11 yrs
Of the major Korean stocks, only 199 made it into this table. Left out: 1 stocks whose value is not a measured one.
OverseasBased on 199 stocks
| Lowest 25% | Middle | Highest 25% |
|---|---|---|
| 8 yrs | 26 yrs | 30+ yrs |
Smallest value 0 yrs, largest value 30+ yrs
Stocks are rarely left out at random. Companies for which a metric does not hold, or for which the source gives no value, tend to be the ones in weaker shape, so the stocks left in the table are the ones in better condition. The middle value of such a table leans to the favorable side compared with the whole market, and the more stocks are left out, the more it leans.
How to read each range
- Lowest 25%
- The quarter with the shortest runs of dividends. Companies that pay no dividend and companies listed only recently are included together, so a short run alone is no reason to think less of a company.
- Middle half
- The run of dividend years is in the common range for the market. For Korean stocks Jupick counts dividends per share in annual reports, and for overseas stocks it counts ex-dividend dates (the first day on which newly acquired shares no longer carry the coming dividend), so the counting method itself differs. Korean and overseas values are not comparable by size.
- Highest 25%
- The quarter with the longest dividend runs. Because the count goes back only 15 years for Korean stocks and 30 years for overseas stocks, values that hit the limit tend to pile up at the top of this band. The actual number of years can be longer than the value in the table.
The two values at either end of the table above are the boundaries that split the stocks into three groups. What it means to belong to each group is written above.
Two stocks that fall just either side of a boundary have practically the same value. Being in different groups does not by itself make them different. The boundaries are drawn again from each day’s sample, so a company can change groups even when nothing about it has changed.
Lowest and highest describe the order of size only, not good or bad. The data is updated once a day.
Stocks with the longest dividend streaks
- 1AEli Lilly and Company30+ yrs
- 2BWalmart Inc.30+ yrs
- 3AJPMorgan Chase & Co.30+ yrs
- 4AExxonMobil Holdings Corporation30+ yrs
- 5BUnitedHealth Group Incorporated30+ yrs
Stocks on Jupick's watchlist that have paid dividends, sorted from the longest run of consecutive dividend years.
Points to watch
- Even with a long record of consecutive dividends, the dividend amount may have shrunk year after year. Not skipping and raising are different stories, so the trend in the amount needs to be checked too.
- A company listed only recently cannot have many consecutive dividend years even if its business is good. This metric alone is no reason to think less of the company.
- The count can differ slightly depending on the data source or counting rules. A change in fiscal year-end, a spin-off or a merger can make the record look broken.
- Jupick counts years for Korean and overseas stocks from different data. For Korean stocks it counts dividends per share in filed annual reports by fiscal year, and for overseas stocks it counts actual ex-dividend date records by calendar year. Because the counting methods differ, Korean and overseas year counts are not comparable by size.
- The look-back also stops at 15 years for Korean stocks and 30 years for overseas stocks. Values that reach that point are written with “or more”, as in “15 years or more” and “30 years or more”. This does not mean exactly that many years; it means Jupick checked that far and the actual run may be longer. Korean financial data are updated in batches of stocks over several days, so right after the range is widened, some values counted with the previous range may remain.
- For overseas stocks only ex-dividend date records remain, so regular and special dividends cannot be told apart. A company that normally pays no dividend but paid only special dividends for a few years can still build up a count, so a stock with a 0% dividend yield and a recorded run is worth suspecting of this case.