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The S&P 500 Index has performed relatively well this year, up 17% year-to-date. But with persistent inflation, rising interest rates, and geopolitical risk from the ongoing war in Ukraine, the possibility of a global recession cannot be entirely dismissed. For this reason, investors could consider quality high-dividend stocks for their portfolios.

At the same time, investors should focus on dividend safety. In a recession, many stocks could end up cutting their dividends. This is why investors should focus on stocks that have a long and established record of raising their dividends each year, even during recessions.

These 3 dividend stocks have yields above 3%, along with growth potential and safe dividends.

Unum Group (UNM)

Unum Group is an insurance holding company that provides a broad portfolio of financial protection benefits and services. The company operates through its Unum US, Unum UK, Unum Poland, and Colonial Life businesses, providing disability, life, accident, critical illness, dental and vision benefits to millions of customers. The company generated $12 billion in revenue last year.

In early August, Unum reported (8/1/23) financial results for the second quarter of fiscal 2023. It grew its operating earnings-per-share 8% over the prior year’s quarter, from $1.91 to $2.06, thanks to strong growth of sales and premiums in its core segments and favorable trends in the Group Disability category.

Adjusted book value per share grew 21% over the prior year’s quarter. Unum beat the analysts’ consensus by $0.20 and now has beaten the analysts’ consensus in 6 of the last 7 quarters. Moreover, thanks to sustained business momentum, Unum reiterated its guidance for growth of earnings-per-share of 20%-25%.

Unum has returned to growth mode thanks to an improvement in premium and investments, expense management, and a meaningful share repurchase program over time. With that said, there are concerns regarding the company’s long-term care policies. The company has increased dividends for 15 consecutive years. Shares currently yield 3%.

Clorox Company (CLX)

Clorox is a manufacturer and marketer of consumer and professional products, spanning a wide array of categories from charcoal to cleaning supplies to salad dressing. More than 80% of its revenue comes from products that are #1 or #2 in their categories across the globe, helping Clorox produce more than $7 billion in annual revenue.

Clorox posted fourth-quarter and full-year earnings on August 2nd, 2023, and results were better than expected on both the top and bottom lines. Adjusted earnings-per-share came to $1.67, which was a staggering 49 cents ahead of estimates. Revenue was up 12.2% year-over-year to $2.02 billion, which was $140 million better than expected.

Growth was driven by strong, broad-based consumption across its portfolio. Gross margin soared 560 basis points year-over-year to 42.7% of revenue. The gain was attributable to the benefits of pricing and cost saving initiatives. This was partially offset by unfavorable commodity costs and higher manufacturing and logistics costs.

The company also offered up strong fiscal 2024 guidance. Guidance for this fiscal year is for adjusted earnings-per-share of $5.60 to $5.90, representing an increase of 10% to 16% from fiscal 2023.

The company’s usually highly stable earnings base generally makes for a safe payout. Even during a recession, shareholders can count on Clorox maintaining (and likely slightly increasing) its dividend payment. Clorox has increased its dividend for over 40 consecutive years and the stock currently yields 3.2%.

Amgen Inc. (AMGN)

Amgen is the largest independent biotech company in the world. Amgen discovers, develops, manufactures and sells medicines that treat serious illnesses. The company focuses on six therapeutic areas: cardiovascular disease, oncology, bone health, neuroscience, nephrology, and inflammation.

In the 2023 second quarter, revenue increased 5.9% to just under $7 billion, beating estimates by $300 million. Adjusted earnings-per-share of $5.00 compared favorably to $4.65 in the prior year, which was $0.51 better than expected. Growth was driven by an 11% increase in volumes, offset by 2% lower net selling prices, 1% lower inventory levels, and a small headwind from currency translation.

Sales for Enbrel, which treats rheumatoid arthritis, grew 2% to $1.1 billion as favorable changes in estimates sales deductions and higher net selling prices were partially offset by lower inventory levels. Prolia, which treats osteoporosis, grew 11% to a record $1 billion, driven by an 11% increase in volume. Repatha, which is used to control cholesterol, grew 30% to a record $424 million.

Future growth will be driven by organic growth, as well as acquisitions. In December 2022, Amgen announced that it had agreed to acquire Horizon Therapeutics in cash for $27.8 billion. The deal is expected to close in December 2023, though the FTC and U.S. several states have sued to block the transaction from taking place.

Amgen provided updated guidance for 2023 as well. The company now expects adjusted earnings-per-share in a range of $17.80 to $18.80 for the year, up from $17.60 to $18.70 and $17.40 to $18.60 previously. At the midpoint, this would be a 3.4% improvement from the prior year.

Amgen has increased its dividend for 12 consecutive years. On December 12th, 2022, Amgen announced a 9.8% quarterly dividend increase to $2.13. The stock has a 3.3% current yield.

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