Warren Buffett loves a good dividend growth stock. Such companies consistently grow their profits year after year and elect to return those higher profits to shareholders.

A business that's able to do that likely has a lot of the characteristics Buffett looks for in a company. And when those stocks trade at a fair value, they can provide exceptional returns for shareholders.

Dividend growers and initiators generated an average return of 10.24% in the 50 years from 1973 through 2022, according to research from Hartford Funds. By comparison, non-payers grew just 3.95%. That might help explain Buffett's uncanny performance as CEO of Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B), substantially outperforming the S 500 index in that same period.

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Source Fool.com