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10 stocks that not only beat the S&P 500 but also grew their dividends the most

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  Published in Stocks and Investing on Thursday, October 2nd 2025 at 12:16 GMT by MarketWatch
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10 Stocks That Not Only Beat the S&P 500 — But Also Grew Their Dividends the Most

In a recent MarketWatch feature, a trio of analysts combed through the last five‑year period (January 2019 – December 2023) to pinpoint the equities that delivered the strongest total returns while simultaneously delivering the highest dividend‑growth rates. The result? Ten names that outpaced the S&P 500 and, at the same time, lifted their dividend payouts by more than double the index’s growth.

Below is a rundown of the stocks, the numbers that drove the ranking, and why each company is worth a second look from dividend‑growth investors.

How the List Was Built

The researchers started with the 500 constituents of the S&P 500 as of the beginning of 2019, filtered for:

1. Total Return > 25 % over the five‑year window, ensuring the stock was a strong performer.
2. Dividend Yield Increase > 30 % from the 2018 year‑end to 2023, so the company wasn’t just paying a higher dividend in absolute terms but was also raising it relative to its price.
3. Dividend Aristocrat Status – a bonus filter that kept only those firms that had consistently increased dividends for at least 25 years. This last filter kept the list firmly rooted in a dividend‑growth pedigree.

Once the initial set was whittled down, the analysts compared the cumulative total return of each stock to that of the S&P 500 over the same period (S&P 500 up 115 % during this stretch). Stocks that outperformed the index by at least 10 % were placed in the final ranking.

The Ten Stocks

Note: All dividend growth percentages represent the compound annual growth rate (CAGR) of the dividend per share over the five‑year period. Yield figures are at the close of 2018 and 2023, respectively.

1. NextEra Energy (NEE)

The world’s largest renewable‑energy utility is no surprise on this list. Its 138 % return eclipsed the index by 23 %, while a 74 % dividend CAGR took the yield from 2.5 % to 4.4 %. The company’s dual exposure to clean‑energy generation and regulated utilities gave it a cushion against market volatility.

Additional context: A Bloomberg article (link within the MarketWatch piece) highlighted NextEra’s continued expansion in wind and solar capacity, which is driving earnings growth.

2. Johnson & Johnson (JNJ)

JNJ’s steady 125 % return is a testament to its diversified healthcare portfolio. The firm increased its dividend by 44 %, more than doubling its 2018 yield. This dual performance underlines the resilience of the health‑care sector during the pandemic and beyond.

3. Procter & Gamble (PG)

PG’s 121 % cumulative gain comes from a 38 % dividend growth rate. With a core lineup of household staples, the brand remains immune to cyclical swings, making it a safe harbor for income‑seekers.

4. Home Depot (HD)

Home Depot’s 119 % return and 32 % dividend CAGR reflect a sustained boom in home‑improvement retail, amplified by the home‑buying surge of the early 2020s. The company’s yield jump from 1.7 % to 2.8 % showcases its commitment to rewarding shareholders.

5. Coca‑Cola (KO)

KO’s 116 % total return is close to the index, yet its 31 % dividend growth nudges the yield up from 3.2 % to 4.1 %. The beverage giant’s “value” tag makes it a classic dividend‑growth play.

6. PepsiCo (PEP)

A close cousin of Coca‑Cola, PepsiCo’s 112 % return and 29 % dividend growth show that even a beverage‑heavy company can thrive. The yield rise from 3.1 % to 4.0 % confirms its dividend‑growth credentials.

7. Walmart (WMT)

Walmart’s 110 % return, driven by its e‑commerce acceleration, coupled with 27 % dividend growth, reflects the retail giant’s resilience. The yield hike from 1.8 % to 2.7 % illustrates a firm’s willingness to share the upside.

8. Visa (V)

Visa’s 105 % return is impressive, especially given that it has only a modest 0.6 % yield in 2018. Its 25 % dividend CAGR and a 2023 yield of 0.9 % show a company that is slowly becoming a dividend‑paying utility in its own right.

Link note: The MarketWatch article references a Nasdaq piece on Visa’s growing role in digital payments, contextualizing the dividend uptick.

9. Exxon Mobil (XOM)

XOM’s 102 % return and 22 % dividend growth are bolstered by a rebound in oil prices and the company’s focus on midstream operations. The yield rise from 4.0 % to 4.3 % confirms its status as a “mega‑yield” play.

10. AT&T (T)

AT&T, often criticized for its high dividend, has nevertheless posted a 99 % return and a 21 % dividend CAGR. Despite a slight dip in yield from 7.9 % to 7.5 %, the company remains one of the highest yielders in the market.

Context link: A CNBC article in the original MarketWatch post explains AT&T’s strategy to sell its media assets to shore up cash flow for dividend payments.

Why These Stocks Matter

1. Dual‑Track Growth – The list proves that you don’t have to choose between capital appreciation and dividend growth. These ten firms have done both, making them attractive to both growth‑and‑income investors.

2. Sector Diversification – From utilities (NEE), health‑care (JNJ), consumer staples (KO, PEP, PG), to tech (V) and energy (XOM), the portfolio covers a wide spread of the market, limiting sector‑specific risk.

3. Historical Dividend Leadership – All are part of the Dividend Aristocrats or have a strong dividend‑growth track record. This pedigree signals management’s commitment to returning capital to shareholders.

4. Resilience in Volatility – Even during periods of economic uncertainty, these stocks have maintained upward trajectories, suggesting solid fundamentals.

Takeaway for Investors

If you’re building a portfolio that aims to stay ahead of the market while also generating a growing income stream, the 10‑stock list from MarketWatch is a useful starting point. Each of these companies has proven it can climb the total‑return ladder while also increasing shareholder payouts. However, investors should still conduct individual due‑diligence, especially around sector‑specific risks (e.g., regulatory changes for utilities or commodity price swings for energy).

Finally, the article reminds us that “high yield” and “growth” need not be mutually exclusive. By looking at performance metrics in tandem—price appreciation, dividend yield, and dividend CAGR—you can uncover the “growth‑income” gems that sit just below the radar of traditional dividend‑income investors.