Expecting a Market Downturn? Protect Your Portfolio With These Dividend Champions

investing.com:

It's still early for the dividend season to kick into high gear, but it's a good time to start considering building a portfolio focused on companies that share profits with shareholders.

For those seeking simplicity, the Dividend Champion portfolio on InvestingPro offers a convenient option. This curated list features established market giants that consistently pay solid dividends.

The portfolio includes major stocks like Exxon Mobil (NYSE:XOM), and Johnson & Johnson (NYSE:JNJ), among others. And these are just a few of the 131 stocks available.

Here are the main characteristics of InvestingPro's Dividend Champion Portfolio:

Source: InvestingPro

Defensive portfolios emphasize diversification and minimizing losses during a market slump. While this strategy reduces the potential for significant gains, it prioritizes the payment of dividends.

Comparing the portfolio's performance with the S&P 500 benchmark over the past year shows lower gains (although over 3 years, the portfolio performs better).

It's crucial to focus on dividends, and noteworthy companies in this context include J&J and Exxon Mobil. Let's take a look at each company individually.

Exxon Mobil claims the top spot among the three major companies in the portfolio, boasting a high dividend yield of 3.65% based on the latest quarterly profit distribution. Crucially, for nearly a decade, this ratio has consistently remained above the 3% threshold.

Source: InvestingPro

Considering its consistent dividend track record and strong standing in the energy market, there is no sign of any significant changes anticipated for the upcoming year compared to what we observed throughout 2022 and 2023.

Johnson & Johnson stands out when considering the dividend history. The