Dividend Investing Glossary

A publicly traded company that has increased its dividend payout for 50 or more consecutive years. Dividend Kings represent the pinnacle of dividend reliability and are widely considered the gold standard for income investors.

An S&P 500 index constituent that has increased its dividend payout for at least 25 consecutive years. To maintain the status, a company must also meet minimum size and liquidity requirements set by S&P.

The annual dividend payment per share divided by the current stock price, expressed as a percentage. It shows how much cash flow an investor receives relative to the stock's market price.

The cutoff date to qualify for the next dividend payment. You must own the stock before this date to receive the dividend. If you purchase on or after the ex-date, the dividend goes to the seller.

The date on which the dividend is actually distributed to shareholders. This is typically 2–4 weeks after the ex-dividend date.

The date a company checks its shareholder registry to determine who is eligible for the upcoming dividend. The record date is usually one business day after the ex-dividend date.

The date the board of directors officially announces the upcoming dividend, including the amount, ex-date, record date, and payment date.

The percentage of a company's earnings paid out as dividends. A lower payout ratio generally means the dividend is more sustainable and has more room to grow. A ratio above 80–90% may signal elevated risk.

A proprietary 0–100 score on DivTracker Pro that measures dividend sustainability. It combines two factors: consecutive years of dividend growth (max 50 points) and payout ratio health (max 50 points). A score of 80+ is considered excellent.

The number of years a company has continuously increased its annual dividend payout without interruption. This metric is the defining criterion for Dividend Kings (50+ years) and Aristocrats (25+ years).

The total dividend paid per share over the course of a year. For quarterly payers, this is simply 4× the quarterly dividend amount.

A dividend paid four times per year, once every three months. This is the most common dividend payment frequency for US dividend stocks, including nearly all Dividend Kings and Aristocrats.

Your effective dividend yield based on your original purchase price, not the current market price. YOC grows over time as the company increases its dividend, making long-term holding of dividend growers particularly rewarding.

The annualized percentage increase in a company's dividend payment over a given period, typically 1, 3, 5, or 10 years. A higher and consistent DGR compounds wealth significantly over time.

On DivTracker Pro, a stock is classified as undervalued when its current dividend yield is significantly higher (10%+) than the 5-year average yield. A higher-than-average yield often means the stock price has fallen relative to its dividend.

A stock is at fair value when its current dividend yield is close (within ±10%) to its 5-year historical average yield. This suggests the stock is trading at approximately its historical norm.

On DivTracker Pro, a stock is classified as overvalued when its current dividend yield is significantly lower (10%+) than its 5-year average yield, suggesting the stock price has risen above historical norms.

A strategy where dividends are automatically used to purchase additional shares of the stock instead of being paid out as cash. DRIP accelerates compounding and is a cornerstone of long-term dividend investing.

A stock market index tracking 500 of the largest publicly traded companies in the United States. Dividend Aristocrats must be members of the S&P 500, while Dividend Kings have no index requirement.

A valuation metric comparing a company's stock price to its earnings per share (EPS). A lower P/E may indicate a more affordable stock, though context and sector norms matter greatly.