Are you looking for a good dividend stock to buy to start 2026 with some income flowing into your portfolio? Below, I've got a list of three blue chip stocks that make for safe investments to hang on to. And they've all been increasing their dividend payments in recent years.
Costco Wholesale (COST +1.10%), Home Depot (HD 2.75%), and McDonald's (MCD 0.34%) are not only solid dividend investments, but you can get them at reduced prices as these stocks are all trading near their 52-week lows. Here's why these can be excellent options to buy if you're looking for long-term dividend stocks to hold for not only years, but potentially decades.
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Costco Wholesale
Shares of Costco have spiked recently, but as of Monday's close, the stock was trading around $945 and was still less than 12% away from its 52-week low of $844.06. Over the past 12 months, the stock's returns have been flat. And while I don't love the stock's inflated price-to-earnings (P/E) multiple of 50, it's hard to argue with the safety and long-term stability that comes with the business.
Costco has generated solid earnings numbers over the years as its warehouses are go-to options for all types of consumers. Even for price-conscious customers, buying in bulk at Costco's stores can help result in longer-term savings. Throw in its generous return policy, and it's one of the better places for consumers to shop -- as long as you don't mind the crowded stores.
NASDAQ: COST
Key Data Points
The company's sales have grown over the years, and with membership renewal rates typically around 90% and higher, Costco's strong numbers speak for themselves. In the trailing 12 months, the company has generated $8.3 billion in net income on revenue totaling $280.4 billion.
Although its dividend yield is modest at just 0.6%, the company has increased its quarterly payout by 86% over the past five years. And occasionally, the company also issues a special dividend, which can make that dividend income look even better.
I wouldn't expect huge returns at its current valuation, but as long as you're willing to hold on for the long haul, Costco can be a solid income investment to put in your portfolio today.
Home Depot
Another top dividend stock you can safely hold in your portfolio today is Home Depot. The stock is trading down 4% over the past 12 months, and it's about 14% away from its 52-week low of $326.31.
At 2.5%, you're collecting a much higher dividend yield with the stock; it's more than double the S&P 500's average yield of just 1.1%. The home repair retailer has also been generous with dividend hikes as its current quarterly payout of $2.30 is 53% higher than the $1.50 it was paying toward the end of 2020.
NYSE: HD
Key Data Points
Home Depot's stock comes at a much more modest valuation as its P/E multiple of 26 is in line with the S&P 500 average. And even though consumers may be scaling back on discretionary purchases, the business remains profitable with margins that are better than Costco's; over the trailing 12 months, Home Depot's net income has totaled $14.6 billion, which is around 9% of the $166.2 billion it reported in sales during that time frame.
McDonald's
Rounding out this list is fast-food giant McDonald's. On Monday, the stock closed at just under $307, within 11% of its 52-week low of $276.53. Admittedly, the stock hasn't fluctuated all that much; its high over the past year isn't a whole lot higher, at $326.32. Like Home Depot, its P/E multiple is also around 26.
The stock pays 2.4% in dividends, and 2026 is likely to be the year that it joins the exclusive club of Dividend Kings, as barring an all-out disaster for the business, it's highly probable that the company will boost its dividend for a 50th consecutive year in the near future. Its current quarterly per-share dividend is $1.86, which is 44% higher than the $1.29 it was paying five years earlier.
NYSE: MCD
Key Data Points
McDonald's is a safe long-term investment to hang on to. Its ability to adapt to changing consumer preferences over the years, while also offering relatively low-priced meal options, has allowed it to continually generate strong results. Over the past four quarters, the company has reported $8.4 billion in profit on sales of $26.3 billion, for an excellent profit margin of 32%.
