2 Dow Jones Dividend Growth Stocks to Buy Now

A popular stock market indicator is the Dow Jones Industrial Average, or Dow. It monitors 30 large-cap U.S. corporations from various sectors. Investors closely monitor the Dow to gauge the U.S. stock market. As of now, the Dow has increased 3.48% in 2024, while the S&P 500 has risen 7.66%.

Despite behind the S&P 500, a few Dow equities are still good buys. Visa (NYSE: V) and Coca-Cola (NYSE: KO) are two of the most attractive. The famous long-term value investor Warren Buffett owns both equities. These two sector leaders have long-term dividend growth, huge economic moats, and solid earnings.

Let's examine these two Dow dividend growth stocks and why you should add them to your portfolio now. Investors should consider Visa, the e-payments giant, for its strong economic moat, high dividend growth, and top-tier position in a growing market.

Visa trades at over 32 times earnings, and its dividend yield of 0.73% is below average for a large-cap U.S. stock. The benchmark S&P 500 trades at 23 times earnings and has a dividend yield of 1.43%, over twice Visa's.

Visa's dividend growth is among the fastest in the market. The company has increased dividends by 15.7% annually over the past five years. Snowball Effect: Visa's high dividend growth and long-term growth prospects suggest a "snowball effect." Due to compounding, dividend growth stocks have exponential returns on capital. Visa may be one of the top dividend growth stocks now due to these two criteria.

Coca-Cola buying debate Due to its robust and broad brand portfolio, Coca-Cola has a wide economic moat. Its brand power lets it charge premium prices and maintain close retailer connections.

Worldwide distribution allows Coca-Cola to reach customers in over 200 countries. Stock analysts expect these competitive advantages and the company's focus on innovation to deliver mid-single-digit revenue growth over the next decade. Coca-Cola has raised dividends for 62 years. It yields 3.26% at current prices, which is attractive.

For a mature, worldwide corporation, Coca-Cola's five-year dividend growth rate of 3.92% is respectable. Visa's is far higher. Coke's shares sell at 24 times earnings, which isn't cheap but not too costly for a top dividend growth stock. Coca-Cola has strong brand power, sustainable growth, and dividends. This mixture promises great profits over time.

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