The average American may not know the name Altria (MO 0.96%), but there's a good chance that they know some of its brands. The tobacco giant owns brands such as Marlboro, Copenhagen, Black & Mild, Skoal, Parliament, and a handful of others. For decades, the stock has been a mainstay of the market, with plenty of up years, but also its share of down years, especially in the past decade or so.
However, through Sept. 15, Altria's stock has outperformed the market so far in 2025, up close to 24% compared to the S&P 500's 12.4% gain. The stock price gains of late are much appreciated by investors, but the real appeal of Altria's stock for most of the past decade has been its dividend. It's arguably the reason people invest in the company.
If you're looking for a dividend stock to add to your portfolio this month, you might want to consider Altria. Here's why.
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A look at the dividend
Despite the price performance, Altria still has one of the highest dividend yields around at nearly 6.4%. With a yield that high, there can be worries of a cut coming. But Altria has increased its dividend annually for 56 consecutive years, making it a Dividend King (a company with at least 50 consecutive years of dividend increases).
Granted, Altria's sales volume has fallen with the decline in smoking rates among U.S. adults, but tobacco's addictive qualities (for better or worse) allow for some pricing power that keeps cash flow steady. Simply raising prices isn't a good long-term business strategy, but it does buy Altria time to find new revenue streams, such as bringing sustainable smokeless and nontobacco options to market.
Altria's free cash flow is more than enough to sustain its dividend, so it's not an issue investors should worry about. Its free cash flow per share was $5.16 over the last 12 months. If it can sustain that, it will be more than the $4.24 per share it will pay out in dividends in the next four quarters.
