<div id="readability-page-1"><p>Here's a statistic that should reshape how you think about investing: Companies that consistently raise dividends have crushed the <strong>S&amp;P 500</strong> by 2.5 percentage points annually since 1972. Not tech highfliers. Not meme stocks. Not cryptocurrency.</p> <p>Boring dividend growers that send checks every quarter while everyone else chases the next shiny object. The math is irrefutable -- $10,000 invested in dividend growers in 1972 would be worth over $4 million today, versus $1.6 million in the S&amp;P 500.</p> <div><p><img src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vZWRpdG9yaWFsL2ltYWdlcy84MzUzODAvZGl2aWRlbmRzLWFsdGVybmF0aXZlLmpwZyZ3PTcwMA?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="700" height="448" original-src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vZWRpdG9yaWFsL2ltYWdlcy84MzUzODAvZGl2aWRlbmRzLWFsdGVybmF0aXZlLmpwZyZ3PTcwMA"/></p><p>Image source: Getty Images.</p> </div> <p>These five blue-chip giants embody that wealth-building formula, combining current income with relentless payout growth that turns patience into prosperity.</p> <h2>1. The patent cliff survivor</h2> <p><strong>AbbVie</strong> <span>(ABBV<span> 1.03%</span>)</span> yields 2.97% and has raised its dividend for 12 consecutive years (as a stand-alone company) despite facing pharma's biggest patent cliff with Humira. The 303% payout ratio looks terrifying until you realize it's distorted by acquisition accounting -- operating cash flow comfortably covers the dividend payments.</p>  <p>Successors Rinvoq and Skyrizi are rapidly growing to fill the Humira gap. Management is guiding for high-single-digit growth through 2029, supporting high-single-digit annual dividend increases in the years ahead.</p> <h2>2. The membership money machine</h2> <p><strong>Costco</strong> <span>(COST<span> -2.92%</span>)</span> sports a tiny 0.57% yield but pairs it with a spectacular 13.2% annual dividend growth rate over the past five years, along with a conservative 27% payout ratio. The warehouse giant's membership fees alone could fund the entire dividend.</p>  <p>With Costco turning inventory roughly 12 times per year and its average warehouse generating about $260 million annually in sales, its economies of scale create formidable barriers for rivals. As a bonus, Costco regularly doles out special dividends -- $15 per share in 2024, $10 in 2020.</p> <h2>3. The premium payment powerhouse</h2> <p><strong>American Express</strong> <span>(AXP<span> 0.55%</span>)</span> delivers just a 0.92% yield but has compounded its dividend at 12% annually over the past five years, with only 21.3% of earnings committed to payouts. Unlike <strong>Visa</strong> and <strong>Mastercard</strong>, Amex controls both card issuance and payment processing, generating 30% returns on equity.</p> <p>The affluent customer base, spending 2.5 times more than average, creates pricing power that survived the pandemic intact. <strong>Berkshire Hathaway</strong> owns 20% of Amex for good reason.</p> <h2>4. The financial data monopolist</h2> <p><strong>S&amp;P Global</strong> <span>(SPGI<span> 0.57%</span>)</span> yields 0.79% but has grown its dividend 8% annually over the past five years while committing just 28.7% of earnings to payouts. The company's credit ratings duopoly with <strong>Moody's</strong> creates an unbreachable moat -- every debt issuer needs their blessing.</p>  <p>Beyond ratings, S&amp;P provides essential financial data through IHS Markit and index licensing that generates fees from trillions in passive funds. With investment-grade debt issuance expected to grow 5% to 7% annually, S&amp;P Global's toll on capital markets ensures predictable dividend growth.</p> <h2>5. The yield champion</h2> <p><strong>Pfizer</strong> <span>(PFE<span> 0.64%</span>)</span> offers a massive 7.2% yield that income investors can't ignore, even with a stretched 90% payout ratio. The COVID windfall is over, but the core business generates sufficient free cash flow to cover the dividend payments.</p> <p>The pipeline includes 100-plus programs, with potential blockbusters in obesity, cancer, and rare diseases. For yield-hungry investors, it's the rare 7% payout backed by genuine earnings power and a diversified drug portfolio.</p> <h2>The dividend compounder's toolkit</h2> <p>These five stocks offer every flavor of dividend investing -- from Pfizer's immediate 7% income to Costco's explosive growth at 0.57%. The key is portfolio construction. Blend high-yielders like Pfizer and AbbVie for current income with compounders like Costco and American Express for future wealth. S&amp;P Global sits perfectly in the middle, offering both growth and yield.</p> <p>Over decades, these dividend powerhouses transform modest initial investments into retirement fortunes through the eighth wonder of the world -- compound interest. Start with equal weights, reinvest every dividend, and let time work its magic. The only mistake is waiting for a better entry point that may never come.</p>                                                                            </div>

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<p>The article highlights five dividend-paying stocks that have consistently outperformed the S&P 500 since 1972. These include AbbVie, Costco, American Express, S&P Global, and Pfizer, each offering a unique blend of yield and growth potential. AbbVie has a 2.97% yield with a strong growth outlook, while Costco boasts a 13.2% annual growth rate despite a lower yield. American Express and S&P Global provide solid returns with manageable payout ratios. Pfizer stands out with a high 7.2% yield. The key takeaway is to construct a diversified portfolio of these dividend powerhouses for long-term wealth accumulation.</p>

- Companies that consistently raise dividends have outperformed the S&P 500 by 2.5 percentage points annually since 1972, with a $10,000 investment in dividend growers turning into over $4 million.  
- Five blue-chip companies exemplify this strategy: AbbVie, Costco, American Express, S&P Global, and Pfizer, each offering a mix of current income and growth potential.  
- The article emphasizes the importance of portfolio construction, advocating for a blend of high-yield and growth stocks to maximize returns through compound interest over time.

5 Dividend Powerhouses to Buy and Never Sell