Picking a good dividend stock has become a lot less straightforward these days. Due to the impact of the COVID-19 pandemic, many companies are suddenly struggling, and cutting or suspending their payouts. That means it's more important than ever for income-focused investors to identify businesses that have a high likelihood of being able to preserve their dividends.

Finding companies that offer that level of security and also a high yield can be particularly challenging. But I think these three dividend stocks meet both of those criteria.

Coins pouring out of a golden faucet to represent the income stream from dividends.

Image Source: Getty Images.

AT&T: 6.6% yield

In its first-quarter earnings report, AT&T (T 1.39%) committed to maintaining its dividend, and the company is well-positioned to deliver on that promise. It reported $3.9 billion in free cash flow for Q1, and said that it had about $10 billion in cash on the books at the end of the quarter. AT&T said that was enough to fund the dividend and pay down debts incurred to finance the acquisitions of Time Warner and DIRECTV.

While its DIRECTV business has been losing subscribers to the cord-cutting trend, AT&T's wireless service segment has consistently grown revenue every quarter for the past year. It's a dependable business that grew Q1 revenue by 2.5% year over year.

The Time Warner division, now called WarnerMedia, saw a decline in Q1 revenue from $8.4 billion last year to $7.4 billion in 2020 due to the impact of the pandemic. However, in 2019, the segment accounted for 18% of AT&T's operating revenue. With its new streaming service, HBO Max, launching in May, WarnerMedia's revenue contribution to AT&T could continue to grow over the long run, further solidifying its revenues.

As AT&T continues to reduce its debt levels, its balance sheet will become even stronger, which will further enhance its ability to maintain its dividend.

IBM: 5% yield

During IBM's (IBM 0.40%) first-quarter earnings call, management reiterated its commitment to the dividend, then backed that up on April 28 by announcing a payout increase. That marked the 25th consecutive year of dividend increases, putting IBM into the Dividend Aristocrats category. Since IBM ended the first quarter with $12 billion in cash and free cash flow of $1.4 billion, it's in a position to fund the dividend.

That decision to increase the dividend came despite the fact that IBM's revenue declined 3.4% year over year in the first quarter. The company has struggled to grow its overall revenue in recent years, but has found a winning formula with its Cloud and Cognitive Software division, which provides businesses with hybrid cloud and artificial intelligence capabilities. Revenues from that segment were up 5% year over year in the first quarter, even with the initial impact of the coronavirus pandemic, and that increase followed 8.7% growth in the fourth quarter.

In fact, new CEO Arvind Krishna previously headed the Cloud and Cognitive Software segment. During the earnings call, Krishna emphasized IBM's focus on hybrid cloud and artificial intelligence solutions. This strategy allows the company to concentrate on growth areas, and Krishna promised to divest parts of the business no longer aligned with this focus, reducing costs. This will help the company return to revenue growth and continue to fund its dividend.

3M: 3.8% yield

A key factor that makes 3M (MMM 0.52%) such a solid dividend stock is its diversification. It's well known for consumer products, but when it announced first-quarter earnings, its healthcare division understandably had a big revenue impact; sales were up 21% year over year, helping to offset declines in other areas such as its transportation and electronics segment, where revenues sank 5%.

In addition, 3M possesses a healthy balance sheet. The company has $4.3 billion in cash and $900 million in adjusted free cash flow to help it get through the pandemic. That's important because, while total sales were up 2.7% year over year in Q1, 3M expects the second quarter to be more difficult. Through mid-April, 3M was seeing double-digit percentage declines in sales. 

The company also suspended its share repurchase program to protect its financial flexibility. That said, 3M reiterated that the dividend is among its priorities.

Solid companies

The fact that these three corporations are in a position to maintain their high-yield dividends only adds to each company's list of strengths. That's why these dividend stocks are worthy of consideration.

While I own shares in AT&T, I plan to buy more, as well as invest in the others during the next market correction. These three solid companies with good dividend yields are a benefit to any investment portfolio.