Dividends are a portion of a company’s profitability and are paid to enhance shareholders’ value. While dividend-paying stocks help to earn steady passive income, investors also benefit from capital appreciation if the value of the stock increases. Further, dividend reinvestment enables investors to buy more shares, which significantly enhances overall returns in the long term due to the power of compounding. 
As dividends are paid out of earnings, companies with a stellar dividend payment and growth history usually have solid fundamentals, a growing earnings base, and good long-term prospects. This implies that investors can rely on them.              
Since dividend stocks can help create significant wealth in the long term, investors should focus on the shares of the companies with a strong track record of uninterrupted dividend payments and the ability to outperform the broader markets in the long term. 
Against this backdrop, I’ll discuss three dividend stocks that have consistently paid and raised their dividends for years. Impressively, these dividend-paying stocks have outperformed the broader markets over the past three years. Also, Wall Street analysts have a favorable outlook on the shares of these companies. 

Enterprise Products Partners (EPD) 

Enterprise Products Partners provides midstream energy services, including the gathering, storage, and transportation of natural gas, natural gas liquids, crude oil, petrochemicals, and refined products. Its solid asset base and long-term, fee-based contracts enable it to generate stable margins and consistent earnings growth despite the volatility in the market.  

Thanks to its growing earnings base, EPD has increased its dividends for 24 consecutive years at a CAGR of 7%. Further, its stock has generated decent capital gains rising about 17% in one year and over 88% in three years. The S&P 500 Index increased approximately 12% and more than 45% in one and three years, respectively.  

EPD’s $5.8 billion worth of major capital projects are under construction and are expected to come into service in 2023-2025. Further, these projects are supported by long-term, fee-based contracts and are likely to drive future growth.  

Overall, its diversified asset base positions it well to easily navigate commodity cycles. Moreover, its continued investments in midstream energy infrastructure with attractive long‐term returns, focus on reducing its debt, strong balance sheet, and growing cash flows augur well for future payouts.  

EPD stock has generated a lucrative average ROIC (Return on Invested Capital) of 12% over the past decade. Further, it offers a compelling dividend yield of 7.5%.  

12 out of 13 analysts have rated EPD stock a “Strong Buy.” The analysts have a 12-month average target price of $31.53, which is about 20.9% higher than its current trading price:  

AbbVie (ABBV) 

AbbVie is a diversified biopharmaceutical company that develops and commercializes advanced therapies across several key areas, including hematologic oncology, neuroscience, eye care, and aesthetics. 

While ABBV stock has witnessed a pullback in the recent past due to the near-term pricing pressure, its solid portfolio has enabled the company to outperform the broader markets in the past three years. AbbVie stock is up about 57% in three years, comfortably beating the S&P 500 Index.  

Furthermore, AbbVie enhanced its shareholders’ returns through higher dividend payouts. Last year, it increased its dividend by 5%. Moreover, since 2013, AbbVie has increased its quarterly dividend by 270%.  

AbbVie’s strength is its robust R&D engine. It’s worth highlighting that the company developed five major billion-plus medicines in the past decade. Further, its increasing investments in R&D and strong product pipeline with over 80 programs across all development stages bode well for long-term growth. In addition, the ongoing momentum in the Neuroscience and Aesthetics portfolio will likely support its growth and future dividend payouts.  

While AbbVie’s long-term prospects remain solid, pricing-related challenges could adversely impact its near-term financials. Of the 16 analysts covering ABBV stock, 7 recommend a “strong buy,” 1 has a Moderate Buy, and 8 suggest a “Hold.”  

Nonetheless, the near-term pricing pressure is expected to moderate. Thus, the analysts have a 12-month average target price of $169.15, which suggests an attractive 27.6% upside potential from the current trading price. Further, the stock offers a decent dividend yield of 4.5%. 

Dover Corp (DOV) 

Dover is a diversified manufacturer of engineered products and components, aftermarket parts, consumable supplies, software, digital solutions, and support services. Its highly diversified and growing end market, solid organic sales and earnings growth, and robust free cash flow generation enable it to consistently return higher cash to its shareholders.  

Dover’s organic sales have grown at a CAGR of 5% over the past five years. During the same period, its adjusted EPS increased at a CAGR of an impressive 15%. Furthermore, its free cash flows grew at a CAGR of 11% in the last three years.  

Thanks to its growing earnings base, Dover has increased its dividend for 67 consecutive years. Besides higher dividend payments, Dover stock has delivered decent capital gains. Its stock has risen by about 19% over the past year. Further, it generated a return of approximately 63% in three years, outperforming the S&P 500 index.  

Dover expects its organic revenues to increase by 4-6% annually through 2025, led by growth platforms, including biopharma, clean energy, software, and vehicle aftermarket. Meanwhile, acceleration in recurring software-enabled products revenue and expansion of the addressable market will likely support growth.  

While its sales are expected to grow, improved mix and portfolio management, SKU rationalization, productivity savings, and cost controls will cushion margins and drive earnings and dividend payouts. 

Of the 14 analysts covering DOV stock, 7 recommend a “strong buy,” and 7 suggest a “Hold.” The analysts have a 12-month average target price of $162.33, which is 12.1% higher than its current trading price. At the same time, Dover stock offers a dividend yield of 1.4%.