Dividend Aristocrats In Focus: Consolidated Edison

Up to date on March twelfth, 2025 by Nathan Parsh

The Dividend Aristocrats are a bunch of shares within the S&P 500 Index with 25+ years of consecutive dividend will increase. These corporations have high-quality enterprise fashions which have stood the check of time and have proven a outstanding capability to boost dividends yearly whatever the economic system.

We imagine the Dividend Aristocrats are a number of the highest-quality shares to purchase and maintain for the long run. With that in thoughts, we created a full listing of all 69 Dividend Aristocrats.

You may obtain the total Dividend Aristocrats listing, together with essential metrics like dividend yields and price-to-earnings ratios, by clicking on the hyperlink under:

Disclaimer: Positive Dividend will not be affiliated with S&P International in any manner. S&P International owns and maintains The Dividend Aristocrats Index. The data on this article and downloadable spreadsheet is predicated on Positive Dividend’s personal overview, abstract, and evaluation of the S&P 500 Dividend Aristocrats ETF (NOBL) and different sources, and is supposed to assist particular person traders higher perceive this ETF and the index upon which it’s primarily based. Not one of the info on this article or spreadsheet is official knowledge from S&P International. Seek the advice of S&P International for official info.

The listing of Dividend Aristocrats is diversified throughout a number of sectors, together with client items, financials, industrials, and healthcare.

One group that’s surprisingly underrepresented is the utility sector. Solely three utility shares, together with Consolidated Edison (ED), are on the listing of Dividend Aristocrats.

The truth that simply three utilities are on the Dividend Aristocrats listing might come as a shock, particularly since utilities are broadly considered regular dividend shares. The 2 different utilities on the listing are Atmos Vitality (ATO) and NextEra Vitality (NEE).

Consolidated Edison is about as constant a dividend inventory as they arrive. The corporate has over 100+ years of regular dividends and greater than 50 years of annual dividend will increase. This text will focus on what makes Consolidated Edison interesting for earnings traders.

Enterprise Overview

Consolidated Edison is a large-cap utility inventory. The corporate generates roughly $15 billion in annual income. The corporate serves over 3 million electrical clients, and one other 1 million fuel clients, in New York.

It operates electrical, fuel, and steam transmission companies.

Supply: Investor Presentation

On January sixteenth, 2025, Consolidated Edison introduced that it was elevating its quarterly dividend 2.4% to $0.85. This was the corporate’s 51st annual improve, qualifying Consolidated Edison as a Dividend King.

On February twentieth, 2025, Consolidated Edison introduced its fourth-quarter and full-year outcomes. Income elevated 6.5% to $3.7 billion, beating estimates by $36 million.

Adjusted earnings of $340 million, or $0.98 per share, in comparison with adjusted earnings of $346 million, or $1.00 per share, within the earlier yr. Adjusted earnings-per-share had been $0.02 forward of expectations.

For the yr, income of $15.3 billion improved 4% year-over-year. Adjusted earnings of $1.87 billion, or $5.40 per share, in comparison with adjusted earnings of $1.76 billion, or $5.07 per share, in 2023.

As with prior quarters, greater fee bases for fuel and electrical clients had been the first contributors to ends in the CECONY enterprise, which is accounts for the overwhelming majority of the corporate’s property. Common fee base balances are anticipated to develop by 8.2% yearly by means of 2029 off of 2025 ranges. That is up from the corporate’s prior forecast for progress of 6.4%.

Consolidated Edison is anticipated to supply earnings-per-share of $5.63 in 2025. The corporate expects 5% to 7% earnings progress from 2025 by means of 2029.

Progress Prospects

Earnings progress throughout the utility trade sometimes mimics GDP progress, plus a few factors. Over the subsequent 5 years, we count on Consolidated Edison to extend earnings-per-share by greater than 6% per yr, which is according to the corporate’s steerage.

New clients and fee will increase are Consolidated Edison’s progress drivers. ConEd forecasts 8.2% annual fee base progress by means of 2029.

Supply: Investor Presentation

One potential menace to future progress is excessive rates of interest, which may improve the price of capital for corporations that make the most of debt, akin to utilities. Thankfully, the market isn’t anticipating the Federal Reserve to boost rates of interest any additional, with the added potential for fee cuts sooner or later that might decrease the corporate’s price of capital. Decreasing charges helps corporations that rely closely on debt financing, akin to utilities.

Consolidated Edison is in robust monetary situation. It has an investment-grade credit standing of A-, and a modest capital construction with balanced debt maturities over the subsequent a number of years.

Aggressive Benefits & Recession Efficiency

Consolidated Edison’s major aggressive benefit is the excessive regulatory hurdles of the utility trade. Electrical energy and fuel companies are needed and very important to society.

In consequence, the trade is very regulated, making it just about unimaginable for a brand new competitor to enter the market. This supplies a large moat for Consolidated Edison.

As well as, the utility enterprise mannequin is very recession-resistant. Whereas many corporations skilled important earnings declines in 2008 and 2009, Consolidated Edison held up comparatively nicely. Earnings-per-share throughout the Nice Recession are proven under:

2007 earnings-per-share of $3.48
2008 earnings-per-share of $3.36 (3% decline)
2009 earnings-per-share of $3.14 (7% decline)
2010 earnings-per-share of $3.47 (11% improve)

Consolidated Edison’s earnings fell in 2008 and 2009, however recovered in 2010. The corporate nonetheless generated wholesome income, even throughout the worst of the financial downturn. This resilience allowed Consolidated Edison to proceed rising its dividend every year.

The identical sample held up in 2020 when the U.S. economic system entered a recession as a result of coronavirus pandemic. Final yr, ConEd remained extremely worthwhile, which allowed the corporate to boost its dividend once more.

Valuation & Anticipated Returns

Utilizing the present share worth of ~$102 and EPS estimates for 2025, the inventory has a price-to-earnings ratio of 18.1. That is simply forward of our truthful worth estimate of 18.0, which is according to the 10-year common price-to-earnings ratio for the inventory.

In consequence, Consolidated Edison shares seem like barely overvalued. If the inventory valuation retraces to the truthful worth estimate, the corresponding a number of contractions would cut back annualized returns by 0.1% over the subsequent 5 years.

Thankfully, the inventory may nonetheless present constructive returns to shareholders, by means of earnings progress and dividends. We count on the corporate to develop earnings by 6% per yr over the subsequent 5 years. As well as, the inventory has a present dividend yield of three.3%.

Utilities like ConEd are prized for his or her secure dividends and secure payouts. The corporate’s anticipated payout ratio for 2025 is 60%, under the 10-year common payout ratio of 67%.

Placing all of it collectively, Consolidated Edison’s complete anticipated returns may appear like the next:

6% earnings progress
-0.1% a number of reversion
3.3% dividend yield

Consolidated Edison is anticipated to return 8.6% yearly over the subsequent 5 years. This can be a modest fee of return, however not excessive sufficient to warrant a purchase advice right now.

Earnings traders might discover the yield engaging, as it’s meaningfully greater than the yield of the S&P 500 Index.

Ultimate Ideas

Consolidated Edison is usually a invaluable holding for earnings traders, akin to retirees, because of its 3%+ dividend yield. The inventory presents safe dividend earnings, and can also be a Dividend Aristocrat, that means it ought to increase its dividend every year.

Total, with anticipated returns of 8.6%, we fee the inventory as a maintain at right now’s present worth.

Moreover, the next Positive Dividend databases comprise essentially the most dependable dividend growers in our funding universe:

Should you’re searching for shares with distinctive dividend traits, think about the next Positive Dividend databases:

The most important home inventory market indices are one other stable useful resource for locating funding concepts. Positive Dividend compiles the next inventory market databases and updates them month-to-month: