These stocks are on their way to becoming dividend aristocrats, Wolfe says
The road to market records isn’t a smooth one, and investors would do well to hold onto a few defensive names to protect their portfolios in shaky times, according to Wolfe Research The Trump administration’s announcement of steep tariffs against South Korea, Japan and five other nations rattled stocks on Monday, with the Dow Jones Industrial Average down more than 500 points and the S & P 500 off 1% at their respective lows of the session. The new duties are set to take effect on Aug. 1. Even as the broad market S & P 500 has seen a sharp reversal from its April lows, there’s still a case to be made for steady income-paying stocks , which can help mitigate volatility in a portfolio. “Our favorite defensive dividend strategy, Dividend Aristocrats, is a good place to ‘hide’ in the event of an economic slowdown or recessionary environment,” Wolfe Research chief investment strategist Chris Senyek said in a late June report. Dividend aristocrats are companies that have raised dividends in each of the past 25 years. Senyek’s team also identified a list of “emerging dividend aristocrats” – companies that have lifted dividends over at least the past 15 years. Here are a few of the up-and-coming dividend payers that are on pace to become dividend aristocrats, according to Wolfe. The firm called out Duke Energy on its list of emerging dividend aristocrats. The utility has lifted its dividend payment each year since 2007 . Shares are up almost 9% in 2025, and the stock pays a dividend yield of 3.6%. Though Wall Street is largely neutral on Duke – 12 of 21 analysts rate it hold and consensus price targets call for 8.5% upside, according to LSEG – Duke also made Goldman Sachs’ conviction list earlier this month. Analyst Carly Davenport highlighted Duke’s partnership with GE Vernova , under which Duke will obtain natural gas turbines to meet its region’s growing energy needs. “Building out new electrical generation capacity has become expensive and time-consuming – given supply chain constraints,” Goldman’s Davenport wrote in a report. “But DUK’s ability to build at scale with its partnership with GEV gives it a competitive advantage to bring on gas generation quicker and more cost effectively than its peers.” Texas Instruments , which raised its dividend for the 21st consecutive year last fall, also popped up on Wolfe’s screen. The semiconductor company last September raised its quarterly dividend 5% to $1.30 per share. Today it yields about 2.6%, and shares are up more than 13% in 2025. In a Sunday report, UBS analyst Timothy Arcuri said that Texas Instruments is among the semiconductor names that “screen well.” “It purposefully maintains elevated inventory in preparation for an upcycle that is starting to materialize (in which TXN is a [market] share gainer) and benefits from its large U.S. manufacturing footprint in light of Section 232 tariffs,” he said. Section 232 tariffs are duties that may be imposed on goods if they are considered a threat to national security. Analysts are largely neutral on Texas Instruments, according to LSEG, and consensus price targets see the stock falling more than 13% from current levels. Prudential Financial made Wolfe’s list after hiking its dividend in each of the past 17 years . In February, the insurer announced a 4% increase to its quarterly dividend, bringing it to $1.35 per share. The company’s dividend yield sits at about 5%, and shares are down nearly 10% in 2025. Last week, Piper Sandler analyst John Barnidge dialed back earnings estimates for several life insurers, calling for Prudential to post current-quarter earnings of $3.25 per share, down from a previous estimate of $3.42. “We reduced our EPS estimates driven by continued fee and spread headwinds,” he said. Barnidge said that while equity markets have been recovering, greater volatility and an expectation for lower interest rates are affecting variable investment income for many life insurers. Wall Street is neutral on Prudential, with 14 of 17 analysts rating it a hold. Consensus price targets see nearly 6% upside from current levels.
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