This Industrials King Has Double the Yield of the S&P 500's Average

Some of my favorite companies to invest in are what I like to call "boring but important."

Here, boring is as far from a bad thing as it's possible to be. These are the companies that show up day in and day out to provide goods and services the world needs to function.

They don't generate the headlines the latest tech start-up or pharmaceutical breakthrough does, but they do generate stable and lasting returns for their shareholders -- either through steady share price growth, a world-class dividend, or some combination thereof.

There's a good chance you use products from a boring but important company daily, but you probably haven't ever spared a thought about the company that made those products.

That's a good thing for people who invest in these companies. The lack of media hype keeps buying pressure and share prices fairly low, allowing the dividends these sorts of companies pay to manage some serious yields.

One case in point is Stanley Black & Decker (NYSE: SWK). It's one of America's oldest companies, and its dividend yields 3.9% at current prices. That's almost double the average S&P 500 stock's 2% dividend yield.

Stanley Black & Decker is also part of a small, noble group of stocks known as Dividend Kings. A Dividend King is a company that has raised its dividend for at least 50 consecutive years. Stanley Black & Decker is on its 58th consecutive year of dividend increases.

Read on to see what a humble tool company can do for your portfolio.

Reliable, dependable, American-made

Stanley Black & Decker was founded in 1843 and still operates out of New Britain, Connecticut, the city it originated. Today, it's a giant of the tool industry. It sells hand tools, power tools, and associated products under the DeWalt, Craftsman, Cub Adet, and Hustler names, and (of course) its own Black + Decker brand.

Its business is simple and straightforward. Even if you're not a contractor or even very handy, it's easy to understand a power tool and why it's useful.

Stanley Black & Decker isn't a growth company. Its revenue has been fairly stagnant in recent years, growing or falling by a couple of percentage points year over year. Even so, it consistently beats earnings estimates.

But there's a bigger reason why you'd want Stanley Black & Decker in your portfolio as well as your tool shed -- the dividend.

Image source: Getty Images.

At present, Stanley Black & Decker pays an annual dividend of $3.32 per share, or four quarterly $0.83 payments. That's good for a 3.9% yield at current prices -- which, as I mentioned earlier, is nearly twice the average for an S&P 500 stock.

The five-year dividend growth rate for Stanley Black & Decker is 3.49%, and I don't see that dividend growth slowing or stopping anytime soon. Once companies achieve Dividend King status, they tend to want to keep it.

Stanley Black & Decker's share price, on the other hand, leaves a lot to be desired. So that's not why you would buy this one. However, despite its share price being in the doldrums since 2020, Stanley Black & Decker is showing early momentum this year. It's up about 13.5% since the beginning of 2026, which is a promising start.

As close to a sure thing as it gets

Whether it keeps up that growth remains to be seen. But what you can be fairly certain of is that this company will continue paying or growing its dividend until the very unlikely event that one of America's largest companies goes under, or the heat death of the universe, whichever comes first. Either way, it's a great stock to buy, set up a dividend reinvestment plan (DRIP), and forget about it as you let it snowball behind the scenes.

There are no sure things in investing. Even the most reliable companies can go out of business. It's just that the odds of that happening to Stanley Black & Decker are very slim. On the other hand, the odds of it increasing its dividend year after year are significantly higher.

It's definitely worth a look if you want a nice, passive investment you don't need to watch closely. That's an invaluable tool for a savvy investor.

James Hires has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.