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Dividend-Growth Outlook for the New Year - December 5, 2023

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  Published in Stocks and Investing on Thursday, December 18th 2025 at 17:56 GMT by Seeking Alpha

Dividend‑Growth Outlook for the New Year – December 5, 2023

Seeking Alpha’s regular “Dividend Growth” update, released on December 5, provides a quick snapshot of the most attractive dividend‑paying stocks that investors are watching as the holiday season rolls in. The post focuses on companies whose yields range from roughly 5 % to 7 %, the sweet spot where investors can earn a healthy cash flow while still enjoying solid long‑term growth prospects. Below is a concise summary of the article’s key points, including the highlighted tickers, their yield and growth metrics, and a few industry‑specific observations that can help you decide whether to add any of these names to your portfolio.

1. The Core Criteria

• Yield window: 5 %–7 % – these stocks are often out of the mainstream radar but still pay solid dividends.
• Dividend‑growth filter: Seeking Alpha’s team only lists companies with a proven track record of raising dividends year over year for at least the last 5–10 years.
• Price‑to‑earnings and payout ratios: Companies must have an attractive P/E and a payout ratio that suggests sustainability (generally < 60 % for high‑yield names).

These filters help filter out “junk” high‑yield names that are just paying the dividend from cash flow deficits.

2. Highlighted Stocks and Their Rationale

Key takeaways:
- Energy leaders (XOM & CVX) remain attractive because they combine high yields with aggressive dividend hikes, backed by robust free‑cash‑flow generation from shale and LNG projects.
- Telecom stalwarts (T & VZ) provide a safety net for investors wary of the growth‑heavy sectors; their yields sit just below the 5 % threshold, but the growth rates are respectable.
- Consumer staples (PEP, PG, WMT) deliver the classic “defensive” dividend story: steady demand, predictable cash flow, and modest growth.
- Healthcare (JNJ) stands out as a hybrid, offering moderate yield but also the resilience of a large‑cap, diversified pharmaceutical portfolio.

3. Industry Trends

Energy – The energy section’s heavy hitters are still the go‑to for high yields, but investors should watch for any signs of a dividend policy shift due to volatility in oil prices or new regulatory frameworks in the US and EU.

Telecom – The push toward 5G and fiber‑optic infrastructure is creating a more stable revenue base. The dividends from T and VZ are supported by long‑term contracts and the growing demand for mobile data.

Consumer Packaged & Staples – These sectors have delivered the most predictable cash flow, and the article notes that both PepsiCo and Procter & Gamble have been consistently adding to their dividends even when commodity prices spike.

Healthcare – Johnson & Johnson’s steady dividend is a testament to its diversified portfolio—everything from consumer health products to medical devices. Investors should watch for potential patent expirations that could affect long‑term earnings.

4. What to Watch

• Dividend sustainability: A high yield can be a red flag if the payout ratio climbs too close to 60 %–70 %. The article advises tracking quarterly cash‑flow statements to confirm that companies can maintain or grow the dividend.
• Economic cycle sensitivity: Energy and telecom stocks are more cyclically sensitive; a downturn in oil prices or a slowdown in 5G rollout could compress earnings.
• Corporate governance: Companies that raise dividends consistently often have a strong board culture focused on shareholder returns. The article highlights a few names that have recently introduced shareholder‑friendly initiatives such as stock‑repurchase programs or “shareholder call” forums.

5. Bottom‑Line Insight

The December 5 update confirms that dividend‑growth investing is still a viable strategy for investors seeking both income and long‑term capital appreciation. While the yield spectrum (5 %–7 %) may not match the extreme high‑yield names that pop up in “Dividend Aristocrats” lists, the companies highlighted in this post have a proven record of paying out dividends that outpace inflation and still generate growth.

If you’re looking to add a new source of income to your portfolio, consider a diversified mix across the sectors highlighted above. For instance, pairing an energy name like Exxon with a defensive staple such as Procter & Gamble can balance the risk of commodity price swings with the stability of consumer demand.

Final Thought
Dividend growth is a long‑term game. The article’s focus on the December 5 data set offers a timely snapshot for investors who want to stay ahead of upcoming ex‑dividend dates. By blending yield, growth history, and sector resilience, the highlighted tickers provide a well‑rounded starting point for any income‑seeking portfolio.