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10 Cheap Stocks Set to Grow Their Dividends

We look at the least expensive companies in the Morningstar US Dividend Growth Index, which looks for cash-rich businesses with sustainable and growing yields.

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Dividend growth strategies have gained attention from investors in recent years, and it's not hard to understand why. Strategies that focus on companies with a history of dividend growth--and the ability to sustain it--such as the Morningstar US Dividend Growth Index, are core, total return-focused equity strategies with a defensive bent.  

It's important for investors to have reasonable expectations for dividend growth strategies, though. Investors seeking current income might not be satisfied with a yield such as the one supplied by the Dividend Growth Index. In fact, the dividend yield for the index is only slightly higher than that of the market as a whole: 2.48% versus 1.88% for the Morningstar US Market Index.

Karen Wallace does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.