Skip to main content

Top Dividend Champions with Unbelievably High Return on Assets (ROA)

In the world of investing, finding companies that not only offer attractive dividend yields but also boast an impressive Return on Assets (ROA) is a winning combination. ROA is a key financial metric that measures a company's ability to generate profits from its assets. Today, we'll delve into the business models, growth potential, and moats of three dividend champions with astonishingly high ROA: Grainger (NYSE: GWW) with 23.7%, Illinois Tool Works (NYSE: ITW) with 20.6%, and Albemarle (NYSE: ALB) with 20.3%.

1. Grainger - 23.7% ROA

Grainger, a leading distributor of maintenance, repair, and operating (MRO) products, has been a stalwart in the industrial sector. The company's robust ROA is a testament to its efficient utilization of assets to generate profits. Grainger's business model revolves around providing a wide range of products, from safety equipment to janitorial supplies, catering to the needs of businesses and institutions.

Grainger's competitive advantage lies in its extensive distribution network and advanced e-commerce platform. The company's commitment to innovation and technological integration has fortified its moat, ensuring sustained growth in an increasingly digitalized marketplace.

2. Illinois Tool Works - 20.6% ROA

Illinois Tool Works, a diversified manufacturing company, has consistently delivered impressive ROA figures. ITW operates in various segments, including automotive, construction, food equipment, and electronics. This diversification allows the company to weather economic fluctuations and adapt to changing market demands.

ITW's business model is characterized by a decentralized structure, with each segment having its own management and operating strategies. This approach enhances agility and responsiveness to specific industry dynamics. Additionally, the company's focus on innovation and continuous improvement solidifies its competitive advantage, creating a durable moat that contributes to its high ROA.

3. Albemarle - 20.3% ROA

Albemarle, a global leader in the specialty chemicals industry, has emerged as a dividend champion with an impressive ROA. The company is a key player in lithium production, a critical component in batteries for electric vehicles and energy storage. Albemarle's strategic positioning in the booming electric vehicle market has been a significant driver of its robust financial performance.

Albemarle's business model is anchored in innovation and sustainability, focusing on providing solutions for a cleaner and more sustainable future. The company's strong presence in the lithium market acts as a substantial moat, shielding it from intense competition. As the demand for electric vehicles continues to surge, Albemarle is well-positioned for sustained growth.

The Importance of ROA

Return on Assets is a crucial metric for investors as it indicates how efficiently a company utilizes its assets to generate profits. A high ROA signifies effective management and operational excellence, showcasing the company's ability to generate more income with fewer resources. This efficiency is particularly vital for dividend champions, as it ensures a steady stream of income for shareholders.

In conclusion, investors seeking dividend champions with remarkable growth potential should consider companies with not only attractive dividend yields but also a high Return on Assets. Grainger, Illinois Tool Works, and Albemarle exemplify this combination, with strong business models, growth prospects, and moats that contribute to their impressive ROA. Understanding the importance of ROA can guide investors in making informed decisions and identifying companies with the potential for long-term success.

Full List of Dividend Champions with high ROA

Discover top dividend champions with remarkable Return on Assets (ROA) – Grainger (GWW) at 23.7%, Illinois Tool Works (ITW) at 20.6%, and Albemarle (ALB) at 20.3%. Learn about their business models, growth potential, and moats. High ROA reflects operational efficiency, making these stocks attractive for income-seeking investors in a diverse market. (Opens in a new window)

by the way...if you like this list and you want more tables like the above published, please help me now. Please read the following text to understand why I need your help. Thank you.

I've been working on this blog for years, without much success. But…many people got a lot of inspirational information from my work - for free. I think that's good, but unfortunately I have my own expenses, a wife and children. That's why I need your support to keep the blog running.

You can easily support my project on the crowdfunding platform Steady (Opens in a new window). It's an alternative to Patreon. 

As a small gift for your support, you will receive monthly updated lists of the best dividend growth stocks in the world -- stock lists from USA, Canada and Japan with over 1.100 long-term dividend growth stocks.

You can use these lists to display, modify, calculate and sort important key figures such as the dividend yield, return on equity ratio, FCF-Yield or price-to-book-ratio. Over 40 ratios are available for sorting. The lists are updated once a month and will be free to use for all supporter on Steady (Opens in a new window).

If you want to know how the Excel-Spreadsheet looks like, you can view a sample file on Google Spreadsheets (Opens in a new window). Just follow the link and you get an idea how it works for you. 

As I said, this is just a sample file. With your help, these Excel-Spreadsheets can be developed further. All I need is a support from you. Please participate in one of the programs listed below to support my project (Opens in a new window).

Thank you so much for your support! If you don't have the financial flexibility to help me, you can easily share this project or post with your social connections on Facebook, Twitter, Instagram, Pinterest or TikTok. It could be a great way to keep this site alive. Thank you so much.


Would you like to be the first to write a comment?
Become a member of Dividends Paradise and start the conversation.
Become a member