My Top Dividend Growth Stock to Buy in September and Hold Forever

As the calendar turns, the lazy summer days are now behind us. With the fall season's arrival, many people have returned to work following summer vacations. That also makes this a good time to check your stock portfolio as we head toward the end of the year.

For dividend-seeking investors, my top pick to buy and hold forever (or at least a very long time) is Coca-Cola (NYSE: KO). Here's why it's my favorite dividend stock.

For starters, shareholders can invest knowing that the company regularly raises dividends. Coca-Cola has done so for a remarkable 64 straight years.

Think about all that's happened during that time: inflation, stagflation, recessions, and wars. Through it all, the company has increased dividends. That makes Coca-Cola a Dividend King -- part of the group of companies that have increased dividends for at least 50 straight years.

Earlier this year, the board of directors raised the quarterly payout by 4% to $0.53. That equates to a 2.4% dividend yield based on the Sept. 22 closing price, more than double the S&P 500 (SNPINDEX: ^GSPC) index's 1% yield.

The beverage maker generates more than sufficient free cash flow (FCF), or operating cash flow minus capital expenditures, to cover dividends. For the first half of the year, Coca-Cola had FCF of $6.9 billion. That compares to the $4.6 billion in dividends paid.

In short, Coca-Cola prioritizes dividends, raises them regularly, can afford them, and offers an above-market dividend yield. That puts Coca-Cola at the top of my list of long-term stock investment opportunities for those looking for dividends.

Lawrence Rothman, CFA 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.