Top 3 High-Yield Dividend Kings Can Withstand the Worst Recessions
These three names have made an elite list of dividend stocks and should continue to raise them for years to come.
You're reading 0 of 1 free page.
Register to read more or Unlock Pro — 50% Off Ends Soon
The Dividend Kings are a group of just 56 stocks that have all increased their dividends for at least 50 consecutive years. That level of dividend longevity makes these stocks highly appealing for dividend growth investors.
The Dividend Kings are also appealing for retirees because of their ability to withstand recessions. Only companies that can continue to raise their dividends through even the worst recessions make it to become Dividend Kings.
This article will discuss three Dividend Kings that have high yields above 4%, and should continue raising their dividends each year.
1. Target Corporation (TGT)
Target TGT was founded in 1902 and has operations solely in the U.S. market. Its business consists of about 1,850 big box stores, which offer general merchandise and food, as well as serving as distribution points for the company’s e-commerce business. Target should produce more than $100 billion in total revenue this year.
Target posted fourth quarter and full-year earnings on March 4, 2025, and results were better than expected on both the top and bottom lines, albeit on reduced estimates.
Adjusted earnings-per-share came to $2.41, which was 16 cents ahead of estimates. Revenue was off 3.1% year over year to $30.92 billion, but did beat by $90 million. Comparable sales in the fourth quarter rose 1.5% year over year due to strong traffic and digital channel performance. Management noted that apparel and hardline categories saw particular strength.
Digital comparable sales continue to drive the top line, adding 8.7% in Q4. Same-day delivery grew by more than 25% from the year-ago period.
We see comparable sales growth as a challenge, offset by sizable margin expansion from low levels in 2023, and a potential tailwind from the buyback. Target’s digital efforts are also working extremely nicely, although there was some pulling back after enormous sales growth during the pandemic.
The remaining buyback authorization should be good for a significant tailwind to earnings per share. The company repurchased $506 million worth of shares in Q4, and had $8.7 billion left on its authorization as of year-end. The company guided for $8.80 to $9.80 in adjusted earnings per share for this year.
The company also sports an extremely impressive dividend increase streak of 56 years. TGT shares currently yield 4.3%.
2. Black Hills Corp. (BKH)
Black Hills Corporation BKH is an electric utility that provides electricity and natural gas to customers in Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota and Wyoming. Black Hills was founded in 1941, and the company is headquartered in Rapid City, South Dakota.
Black Hills Corporation reported its fourth quarter earnings results in February. The company generated revenues of $597 million during the quarter, which was 1% more than the revenues that Black Hills Corporation was able to generate during the previous year’s quarter. This was a reversal from the previous quarter, when revenues had been down.
Black Hills Corporation generated earnings per share of $1.37 during the fourth quarter, which was above the consensus analyst estimate. Earnings per share were up by close to 20% versus the previous year’s quarter. Q4 and Q1 are seasonally stronger quarters due to higher natural gas demand for heating, which was again showcased by the above average profitability during the fourth quarter.
Management forecasts earnings per share of $4.00 to $4.20 for the current fiscal year. Growth over the coming years depends on several factors. This includes rate reviews, which drive revenues and profits per kWh. Another factor is the expansion of the company’s existing assets via new utility infrastructure. Black Hills regularly adds new projects to its growth investment backlog.
Planned growth investments include new electric transmission lines and new natural gas pipelines to service its customers. Rate reviews will allow Black Hills to recover investments into its existing systems, thereby more or less guaranteeing increasing revenues over time as long as volumes on existing systems remain unchanged in the long run, which should lead to rising profits down the road.
Now that the company exited its oil business, the increased focus on its core utility business is a positive for Black Hills, as this allows for more consistent and reliable growth.
BKH has increased its dividend for 55 years and currently yields 4.5%.
3. United Bankshares (UBSI)
United Bankshares UBSI was formed in 1982 and since that time, has acquired more than 30 separate banking institutions. This focus on acquisitions, in addition to organic growth, has allowed United to expand into a regional powerhouse in the Mid-Atlantic with about $30 billion in total assets, and annual revenue of about $1 billion.
United posted fourth quarter and full-year earnings on January 24, 2025, and results were better than expected on the bottom line. Earnings came to 69 cents per share, which was 33 cents ahead of estimates. Revenue was off slightly to $262 million, missing estimates by $12 million. Provisions for credit losses came to $6.7 million, a slight improvement year over year. Net interest income came to $232 million, up 1% from Q3.
The boost came primarily from a lower average rate paid on deposits. This was partially offset by a lower yield on average net loans and leases held for sale. Average earning assets rose $556 million, or 2%, from Q3. Most of this was due to an increase in short term investments of $420 million. The yield on average net loans and leases was down 18 basis points from Q3. Net interest margin for the fourth quarter was down three basis points from Q3 at 3.49%.
Future growth will come organically, as well as through acquisitions. United completed its acquisition of Piedmont Bancorp on January 10. Piedmont had $2.4 billion in total assets, loans of $2.1 billion, and deposits of $2.1 billion. United noted it took $1.3 million in merger-related expenses in the fourth quarter.
United’s dividend payout ratio is now 55% of earnings, and we expect it will move higher. We see United’s dividend as safe and able to weather an economic downturn. UBSI has increased its dividend for 50 years and currently yields 4.2%.
At the time of publication, Ciura had no positions in any securities mentioned.