Market downturns are a normal and necessary part of the investing cycle. Long-term investors accept that their portfolios will experience swings. Instead of fearing volatility, view it as the price you pay for potentially higher long-term returns.
As a retail investor, you can't control interest rates, geopolitical events, or daily stock movements, but you can control your asset allocation, your discipline in sticking to your long-term plan, and your emotional reactions to market noise.
If you're looking for dividend stocks to add to your portfolio as you build out a profitable basket of stocks, you've come to the right place. Here are two dividend stocks that you might want to consider scooping up right now.
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1. Realty Income
Realty Income (O +0.68%) pays a dividend on a monthly basis and has paid 666 consecutive monthly dividends to date. That's a pretty impressive track record, especially when you consider that the company has increased its dividend 133 times since its 1994 NYSE listing, and executed 113 consecutive quarterly increases.
The stock yields just under 6% based on current share prices. It's delivered a total return of about 80% for investors over the trailing decade.
Realty Income's model involves buying single-tenant commercial properties and leasing them long-term with triple-net (NNN) leases. This means that tenants pay taxes, insurance, and maintenance, which also reduces Realty Income's costs to support its profitability and stable, monthly dividends. The real estate investment trust (REIT) targets essential, non-discretionary businesses.
It also offers sale-leasebacks to provide capital for operators. Top tenants include grocery, discount, convenience, and fitness operators like Dollar General, 7-Eleven, Walgreens, LA Fitness, AMC, FedEx, Family Dollar, CVS Pharmacy, and Home Depot.
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As one of the largest net lease REITs, Realty Income has a strong, investment-grade-rated balance sheet, which affords it easy and low-cost access to capital markets. This scale allows it to pursue large acquisition deals that are often unavailable to smaller competitors.
Realty Income is actively expanding into European real estate markets, which recently accounted for a significant portion of its investment volume and are offering higher initial cash yields compared to U.S. properties. The company is operating in eight European countries, including the U.K., Spain, Ireland, and Poland.
In the third quarter of 2025, Europe accounted for $1 billion (about 72%) of the company's total investment volume, compared to $380 million invested domestically. European properties offer an initial weighted average cash yield of approximately 8% to Realty Income's portfolio, which is a meaningful premium to the roughly 7% yield on new U.S. property acquisitions.
In Q3 2025, Realty Income's revenue reached $1.47 billion, up 10.5% year over year, and it delivered stable portfolio performance with 98.7% occupancy. Adjusted funds from operations (AFFO) per share ($1.08) met analyst forecasts, and this metric was up single digits from the prior year. This top dividend stock looks like it could be a smart buy right now.
2. PepsiCo
PepsiCo (PEP 0.17%) has consistently increased its dividend for 53 consecutive years, so it's part of the elite group of stocks known as Dividend Kings. The stock's total return -- including dividends -- comes to more than 100% over the trailing decade, despite its somewhat dismal performance over the last few years. And, the stock yields about 3.8% based on share prices at the time of this article.
PepsiCo manufactures, markets, and sells a massive portfolio of drinks and snacks, including household names like Pepsi, Lay's, Doritos, Mountain Dew, Gatorade, Cheetos, Quaker Oats, and Tropicana. The company has faced a tough few years due to a confluence of factors. Persistent inflation has led consumers, particularly low- and middle-income households, to cut back on spending and opt for cheaper private-label alternatives over PepsiCo's branded snacks and beverages. This has resulted in declining sales volumes across key segments, including Frito-Lay and Quaker Foods.
There's also a growing consumer trend toward healthier products with cleaner labels and fewer artificial ingredients. This has impacted sales of traditional snack and soda brands, which are perceived as less healthy, and this issue remains an industrywide headwind. For a period, PepsiCo maintained revenue growth by aggressively raising prices. However, this strategy appears to have plateaued.
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The beverage business has lost market share, even as the company has faced high operating costs, which have squeezed margins. High debt levels and free cash flow issues have also put a strain on its financial flexibility. So, what could spell a turnaround for this business? Elliott Management, a major activist investor known for taking stakes in underperforming companies, has taken a $4 billion slice of PepsiCo and pushed the beverage maker to overhaul its operations. As part of these changes, PepsiCo agreed to cut about 20% of its SKUs and reformulate some snacks to be healthier. To counter consumer shifts, PepsiCo will also lower prices on core food items to align with Elliott's goal to boost affordability.
Elliott also pushed for PepsiCo to refranchise its bottling network (similar to Coca-Cola's model). PepsiCo's CEO, Ramon Laguarta, stated that while discussions with Elliott were constructive, a full refranchising of the North American beverage operations wasn't on the table. Instead, PepsiCo is pursuing its own strategy, which includes testing an integrated model in markets like Texas that combines the supply chains and distribution operations of its snacks and beverages businesses to improve margin efficiency and reduce costs. If this pilot program is successful, it could be expanded to other manufacturing sites.
Laguarta has stated that the company should achieve better margins thanks to these and other changes starting in 2026. While Elliott Management didn't get a board seat, PepsiCo committed to refreshing its board with directors who have relevant global experience. While earnings are down, PepsiCo is still growing revenue and remains profitable. The company's total Q3 net revenue rose 2.6% year over year to just shy of $24 billion, and it reported net income of $2.6 billion. The company has also brought in more than $7 billion in free cash flow over the trailing 12 months.
A major leadership change, including a new CFO and a new CEO for North America (effective Dec. 28, 2025), should be integral to the plan to accelerate growth and integrate food and beverage operations. Strategic acquisitions, such as the $1.95 billion purchase of Poppi in mid-2025, also signal the company's push into healthier, high-growth categories like prebiotic sodas.
PepsiCo has provided a preliminary 2026 outlook where it expects organic revenue growth of 2% to 4% and core constant currency EPS growth of 4% to 6%. Investors willing to stay with PepsiCo through this volatile period who have confidence in its turnaround story could benefit from a robust dividend in the meantime and a position in a storied consumer business.
