We all want to find the right investments to help us retire early. Although many high-risk, short-term investments come with the allure of astronomic yields (and risks), nothing beats the consistent growth and stability of dividend stocks, even amidst market uncertainties.

Dividend Aristocrats are an investment with a proven track record. These companies have consistently increased their dividends for at least the last 25 years, surviving many financial collapses, recessions, and everything in between. Contrary to popular belief, many of these stocks are outperforming the S&P 500 YTD return of a paltry 1%! 

Combine that with other key metrics - say, net income growth and Wall Street ratings - and you have a recipe for an excellent long-term income stock that represents a terrific opportunity for capital growth! So, let’s look at the top Dividend Aristocrats that are beating the market. 

How I Came Up With The Following Dividend Aristocrats 

I used Barchart’s Stock Screener tool to get the list using the following filters.

• Net Income Growth Last Year (%): More than 50%. A sharp increase in the net income indicates a strong company's financial health. Long-term investment portfolios are anchored on a company’s profitability, which reflects its successful strategies.
• YTD Percent Change: >10%. Aside from financial health, it’s essential to see how much a stock has increased this year.
• Current Analyst Rating: 3.5 (Moderate Buy) to 5 (Strong Buy), considering the analysts' confidence about a stock.
• Annual Dividend Yield: Over 0.01% to shortlist companies yielding returns to shareholders through dividends.

With these filters set, I ran the screen and got exactly three results:

I arranged these based on the YTD change since we are highlighting the strongest stocks performing this year. With that settled, let’s discuss these three stocks starting with:

Cardinal Health (CAH)

Cardinal Health is a global healthcare service provider and products company. It focuses primarily on pharmaceutical distribution, healthcare laboratories and facilities, and carbon footprint reduction. With 50 years of expertise, Cardinal Health operates in over 30 countries and serves over 90% of US hospitals, proving its significant presence in the healthcare industry. 

Cardinal Health is a Dividend Aristocrat with over 25 consecutive years of dividend increases. Today, it pays a forward annual dividend of $2.04 ($0.5107 per quarter), which translates to an approx. 1.29% yield. It’s not as high as some dividend stocks, but CAH stock offers a stable and increasing dividend, perfect for a long-term portfolio.

CAH stock increased by nearly 31% YTD—the highest on this list and far better than the S&P 500’s 1%. 11 analysts rate CAH stock a “strong buy” with a high target of $173, suggesting more than 11% potential upside.

Abbott Laboratories (ABT)

The second Dividend Aristocrat on the list is Abbott Laboratories, which I have covered extensively, so I’ll keep the introductions short. Abbott is among the most prominent healthcare companies, offering medical care and other popular healthcare products in over 160 countries. 

Abbott Laboratories is also a member of the exclusive Dividend Kings list, having increased its dividends for 53 consecutive years. It pays a forward annual dividend of $2.36 ($0.59 quarterly), which is approximately 1.75%. Seventeen analysts rate ABT stock as a strong buy. 

In terms of performance, ABT stock is up 19.5%, easily beating the S&P 500. 

Ecolab Inc (ECL)

Ecolab Inc. is a global leader specializing in water, hygiene, and infection prevention. It has a customer base from 40 industries and over 170 countries. 

Ecolab and its subsidiaries cover various industries, including animal and plant production, food and beverage, mining, power generation, and more. For example, the company owns Nalco Water, a division specializing in water and chemical treatment for industrial and institutional customers. 

Net income at Ecolab grew by almost 54% last year and consistently exceeds earnings estimates - at least in the previous four quarters. ECL stock is rated a moderate buy, and so far, the stock is up around 12% YTD, again easily beating the S&P 500. 

Ecolab has increased its dividend payouts yearly for over 25 consecutive years, making it a Dividend Aristocrat. Its forward annual dividend is $2.60, translating to around a 1.0% yield. 

Final Thoughts

These three Dividend Aristocrats may not have the highest yields, but their track records are consistent, and the stocks are resilient, with proven long-term value, making them ideal candidates for any long-term portfolio anchored on stability and steady growth. Regardless, always do your due diligence before hitting the “buy” button.