2 ASX 200 dividend champions

There are many businesses overseas that are dividend champions which have increased their dividends consecutively for more than 25 years. There aren’t any ASX 200 shares that have that long of a streak, but there are two that are nearly there.

Two ASX 200 shares have increased their annual ordinary dividend every year since 2000.

Here they are:

Ramsay Health Care Limited (ASX: RHC)

Ramsay is the largest private hospital operator in Australia and one of the biggest in the world.

Healthcare is a continually-growing industry with the ageing population in Australia and overseas. Ramsay has maximised the opportunity by making a number of acquisitions as well as re-investing into expanding its existing portfolio of hospitals.

Ramsay is a high-quality business that has rewarded shareholders handsomely with growing dividends over the past two decades.

However, it is now facing a number of headwinds including private health insurance affordability and shrinking patient numbers, at least in the short-term.

Ramsay is currently trading at 20x FY19’s estimated earnings. Whilst the valuation has become more attractive over the past couple of years, I don’t think that investors should buy Ramsay just for the dividend history.

Short-term pain can create a good opportunity for buying if you can see a catalyst for a turnaround. However, at this stage I can’t see a catalyst – the government and public are finding it difficult to fund the private system. I’d re-consider Ramsay if it were 15% (or more) lower than the current price.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts is an investment conglomerate that has been operating for over a century. It has paid a dividend throughout the many decades it has been going, including through wars and recessions.

Its current dividend streak is impressive and I believe it could continue to grow for many years to come due to its market-beating investment performance and its long-term focus.

I like that Soul Patts can change its portfolio to adapt to the best investment opportunities, it isn’t stuck being a private hospital business or a telco like other industry-specific ASX shares.

Out of all the shares on the ASX I think that Soul Patts could be one of the ones most likely to grow its dividend over the next decade.

However, the dividend yield has been compressed significantly due to the strong performance of the share price, the grossed-up yield is now only 2.7%.

Foolish takeaway

At the current prices I wouldn’t call either of them a good value buy. If I had to choose one it would be Soul Patts because of its diverse investments and long-term performance, however I’d like to buy more of it with a yield above 3%.

Another share making a name for itself as a quality dividend share is this top stock which increased its dividend by 20% in FY18.

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Motley Fool contributor Tristan Harrison owns shares of Ramsay Health Care Limited and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Ramsay Health Care Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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