3 Dividend Aristocrats Wall Street Says Can Soar 48% in 2025

Dividend growth investing focuses on acquiring stocks that consistently increase their dividends, providing investors with a reliable, inflation-beating income stream and potential capital appreciation. This strategy prioritizes companies with strong fundamentals, stable cash flows, and disciplined management, ensuring long-term wealth creation with lower volatility than non-dividend stocks. 

Dividend Aristocrats are an elite group of companies on the S&P 500 with 25 or more years of consecutive dividend increases. They exemplify this approach, demonstrating remarkable resilience through economic cycles, including recessions and market crashes. These firms, often in defensive or essential industries, offer dependable payouts that compound over time, making them ideal for retirees or patient investors. 

Of the thousands of stocks that trade daily, fewer than 70 have achieved this distinction. That is why stocks that have ascended to dividend royalty remain a cornerstone for income-focused portfolios, blending stability with growth. Wall Street identifies the following three Dividend Aristocrats as having the best opportunity for gains over the coming year, with one-year price targets that imply their stocks can rise between 46% and 59% from current levels.

Nucor (NUE)

Leading steel producer Nucor (NYSE:NUE) has paid increasing dividends for 52 years, earning not only Dividend Aristocrat status, but also Dividend King status, which is reserved for stocks that have increased their payout for 50 or more years. Its mini-mill technology has proven operational excellence and adaptability, using scrap metal to keep costs low and enable consistent profitability even during steel price swings. 

In this year’s first quarter, Nucor generated adjusted earnings of $0.77 per share, handily beating estimates of $0.68 per share. Nucor’s dividend of $2.20 per share — increased 1.9% in December — yields 2%, with an ultra-low 10% free cash flow (FCF) payout ratio. That ensures the dividend is safe and sustainable, with plenty of room for future growth. The steelmaker has grown the payout at a near 4% compound annual rate for the past decade, but it is over 6% in the last five years, making the low December increase an anomaly. 

Wall Street has a $159 per share consensus price target on NUE stock, implying 48% upside, with estimates ranging as high as $200 per share, suggesting 83% growth is possible. It reinforces Nucor’s premier industry status and its position as a dependable dividend grower for long-term investors seeking industrial stability.

Albemarle (ALB)

Global lithium and specialty chemicals producer Albemarle (NYSE:ALB) is the second Dividend Aristocrat stock analysts expect significant gains from this year. It has raised dividends for 30 years and has been a beneficiary of the electric vehicle boom. However, first-quarter revenue of $1.1 billion suffered a 21% decline year-over-year due to declining lithium prices. Pricing which stood around $20 per kilogram LCE (lithium carbonate equivalent), fell to the $12 to $15/kg level in the first half of 2024 and ended the year at $9/kg LCE.

Albemarle’s dividend yields 2.8%, but the company has been generating losses and consuming cash instead of producing FCF. This calls into question whether it can maintain its dividend at current levels. It’s noteworthy Albemarle maintained the payout despite its industry being in oversupply for several years, but 2025 is expected to be the bottom, though tariffs and EV demand create substantial uncertainty.  

Even so, Wall Street sees ALB stock rising 59% over the next 12 months to $91.62 per share, with an industry high of $170 per share set by analysts at Oppenheimer back in November. Albemarle trades around $57 per share today, down 55% in the past year, but I’d be leery of buying in for its dividend payment.

West Pharmaceutical Services (WST)

West Pharmaceutical Services (NYSE:WST) is the leading player globally in primary packaging and delivery components for injectable therapeutics. It should benefit from the pharmaceutical industry’s increasing use of biologic drugs and the stricter regulations requiring higher quality packaging. That should allow West to enjoy margin expansion for its high-value product lineup.

The company has delivered 31 years of dividend increases, earning Dividend Aristocrat status through its critical role in healthcare. Its quarterly dividend of $0.21 per share is supported by a 13% FCF payout ratio, indicating safety, sustainability, and the potential for years of additional increases.

West has increased the payout at a 4% compound annual growth rate for the past five years and at 7.3% annually for the last decade. It hiked the dividend by 5% last year to its current level.

Wall Street set a one-year price target of $332.50 per share, implying 58% upside, with a high-side estimate of $400 per share, or 90% upside. With the growth in popularity of injectable GLP-1 drugs like Ozempic and Mounjaro, West Pharmaceutical could have plenty of growth ahead.

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