3 Dividend Stocks for September 2025
#Morningstar #BlackRockStock #dividendstocks
This month’s trio includes an unofficial dividend aristocrat.
00:00 Introduction
00:10 BlackRock BLK
01:04 Essential Utilities WRTG
02:16 Roche RHHBY
BlackRock is the world’s largest asset manager, has grown its dividend at a 9.1% annualized rate over the past five years. That’s a solid rate of dividend growth, but it hasn’t been enough to keep up with the general trend of the share price of the stock. It currently yields 1.8%, well below its average yield of 2.6% for the past five years, and less than the yields of asset manager peers such as T. Rowe Price TROW and Invesco IVZ. Morningstar analysts forecast that the dividend will continue to increase at a steady rate, with the annual rate rising from $20.84 per share to $25.32 by 2029. This would keep the payout ratio, based on their forward earnings estimates, at 35% to 45%. The stock is currently trading just above its $1,100 Morningstar fair value estimate, placing it in 3-star territory.
With more than 25 consecutive years of annual dividend growth, Essential Utilities, a Pennsylvania-based holding company for water and gas distribution utilities, qualifies as a dividend aristocrat, though it’s an unofficial one, as it isn’t a constituent of the S&P 500 index. And while some dividend aristocrats maintain their streaks via minimal annual raises, Essential has increased its dividend by at least 5% each year for the past 32 years, including a 5.3% dividend increase in late July. The stock currently yields 3.5% and annualized dividend growth is 6.9% over the past five years.
The utility’s chair and CEO, Christopher Franklin, mentioned the streak during the Aug. 1 earnings call and also said, “We remain committed to maintaining a strong balance sheet, improving our cash flow and debt metrics, and delivering consistent dividend growth while keeping our payout ratio between 60% and 65%.”
Morningstar analysts expect the dividend to grow in line with their 6% annual earnings growth forecast. The stock is currently trading at around a 10% discount to its $44 fair value estimate, landing in 4-star territory.
Roche, a Swiss biopharmaceutical and diagnostics company, makes a single dividend payment each spring, with the base currency payout in Swiss francs converted to US dollars for the ADR
shareholders. US investors are also subject to ADR fees and tax withholding, so please consult with your tax professional for guidance here.
The most recent dividend, paid in May, was $1.389 per ADR share, which translates into a 3.5% yield for the stock. Dividend growth has been relatively modest, at 2.5% annualized over the past five years. However, Morningstar equity analysts anticipate somewhat larger raises in the future, saying “We expect Roche to maintain a dividend payout ratio around 50% going forward, implying high-single-digit annual increases in the dividend each year.” Priced at around a 25% discount to its fair value estimate, the stock is currently in 5-star territory.
I’m David Harrell from Morningstar DividendInvestor. Thanks for watching, and we’ll see you next month.
What to watch from Morningstar. 10 Top Dividend Stocks for 2025 https://youtu.be/1t9zi6L9yXw?si=fsVEdYLPflVzQQTP 3 Dividend Stocks for June 2025 https://youtu.be/1ZWvzxIhkYw?si=us–cOAkC8liV5zc
13 Elite Companies With Fast-Growing Dividends https://youtu.be/CiTeStBNnh8?si=jm0qKLlOn3JwBq36 3 Dividend Stocks for May 2025 https://youtu.be/7LqEVdJF23A?si=IOFfZKOSXnIQh2wl
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