Dividend stocks are shares of companies that make regular distributions to their shareholders, usually in the form of cash payments. Dividend stocks can be a useful source of income, but the best dividend stocks can also be an excellent way to build wealth over the long term.
However, not all dividend stocks are great investments, and many investors are unsure how to start their search. With that in mind, here's a list of dividend-paying stocks you might want to consider and some of the most important things to look for in top dividend stocks.
How to invest
How to buy dividend stocks
If you want to buy shares of any dividend stock, here's what you need to do.
- Open your brokerage app: Log in to your brokerage account where you handle your investments.
- Search for the stock: Enter the ticker or company name into the search bar to bring up the stock's trading page.
- Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this stock.
- Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
- Submit your order: Confirm the details and submit your buy order.
- Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.
Nine best stocks
Nine best dividend stocks
The Dividend Kings list is a great place to find top dividend stocks. Dividend Kings are companies that have paid and raised their base dividends for at least 50 consecutive years.
The Dividend Achievers list, whose companies boast 10-plus straight years of dividend increases, is a trademarked property owned by Nasdaq and another great list to research.
Here are nine top dividend stocks to consider buying now.
| Company name | Company ticker | Market cap | Dividend yield |
|---|---|---|---|
| Lowe's Companies | NYSE:LOW | $135 billion | 1.93% |
| Realty Income | NYSE:O | $54 billion | 5.39% |
| Chevron | NYSE:CVX | $311 billion | 4.44% |
| Target | NYSE:TGT | $41 billion | 4.95% |
| Starbucks | NASDAQ:SBUX | $94 billion | 2.94% |
| Brookfield Infrastructure | NYSE:BIPC | $6 billion | 3.60% |
| Microsoft | NASDAQ:MSFT | $3.8 trillion | 0.65% |
| American Express | NYSE:AXP | $230 billion | 0.96% |
| Clearway Energy | NYSE:CWEN | $4 billion | 5.38% |
Companies 1 - 3
1. Lowe's
Home improvement giant Lowe's (LOW 0.41%) may not seem like a very exciting stock. And that's true -- unless you like dividend growth. The company has raised its dividend almost every year since going public in 1961 and has raised the payout by more than 300% over the trailing decade alone.
Investors worried about the housing downturn shouldn't fret. When the housing supply is tight, homes are harder to buy, and people tend to spend more to upgrade their existing homes. So, any cyclical weakness in its results will likely return to growth over the long term, even if short-term shifts in consumer spending cause an overall slowdown in renovations.
2. Realty Income
If you're looking for a simple way to invest in high-quality real estate for income and growth, Realty Income (O 1.01%) might be the perfect stock. The company owns an array of largely e-commerce-resistant properties, earning strong cash flow from tenants on long-term leases.
Realty Income also has recorded more than three decades of consecutive annual dividend increases every year since going public in 1994 -- and more than 55 straight years of paying a dividend every month. Since its founding, Realty has declared 662 consecutive monthly dividends and has habitually increased its dividend for the last 30 consecutive years.
3. Chevron
For years, Chevron (CVX -0.27%) has been a big winner for investors and a solid stock to own, especially for dividend investors. It has maintained a steady track record of generating strong cash flows and growing payouts modestly every year for 38 years and counting.
The stock price can fluctuate with oil prices, and Chevron has been part of the volatility trend afflicting many oil stocks recently. Still, Chevron has proven a profitable investment for dividend-seekers over the long term.
Companies 4 - 6
4. Target
For years, Target (TGT 2.25%) was more profitable than its peers, posting some of the highest gross margins and operating margins in retail. At the same time, its focus on increasing its e-commerce business and expanding in-store offerings helped stabilize its top line while improving profitability.
5. Starbucks
Over the past four decades, Starbucks (SBUX 2.07%) has established itself as the dominant global brand in coffee beverages. With more than 40,000 global stores and Starbucks-branded ready-to-drink beverages and packaged coffee in hundreds of thousands more locations, nobody sells -- or buys -- more coffee than this company.
6. Brookfield Infrastructure
Sometimes, the best stocks are the ones hidden in plain sight. That's the case with Brookfield Infrastructure (BIPC 2.6%) (BIP -0.89%), which owns water, energy, utility, transportation, and communications infrastructure projects worldwide. At recent Class C share prices, it claimed a dividend yield of about 4.1%, more than 5% for the limited partner units, and aims to raise the payout by 5% to 9% every year.
Companies 7 - 9
7. Microsoft
Microsoft (MSFT -0.15%) is one of the most important software companies on the planet. Over the past decade, it has rebuilt its business to focus on recurring subscription-based revenue that keeps its customers connected and the cash flowing. Its yield of less than 1% at recent prices hasn't put it on many dividend investors' radars. But what it hasn't paid in yield, Microsoft has absolutely delivered, with total returns of more than 3,000% since 2009 and dividends accounting for a sizable portion of those total returns.
8. American Express
Financial services, such as consumer and business lending, are another place to find a handful of top dividend stocks, and American Express (AXP -0.62%) is one of the best. Although it's not on the list of companies that raise their dividends every year, Amex has a decades-long track record of either raising or maintaining its dividends through every economic environment.
9. Clearway Energy
Renewable energy is mostly considered a place for growth investors, but it's also a wonderful opportunity for dividends. Clearway Energy (CWEN.A 2.2%)(CWEN 2.36%) is a perfect example. The company invests in, acquires, and operates renewable energy facilities, selling the power on long-term contracts -- think decades, not years -- to utility companies and large power consumers. Its dividend yield was around 6.2% as of September 2025.
Highest dividend stocks
Whether it's to generate the income you'll use today or the capital you can reinvest to increase your wealth, there's a good chance you're looking for a big dividend payout. If you're hoping to maximize the number of dividends you earn, here are some suggestions.
First, consider dividend yield above dividend size. The dividend yield is a percentage of the share price you paid for the stock, paid in dividends annually.
Don't make owning high-dividend-yielding stocks your No. 1 priority. Focus first on business quality and a company's ability to maintain and increase the payout.
Dividend investors should focus not on dividend size but on dividend yield.
How to choose
How to choose dividend stocks
This article hits on a few things to avoid (e.g., focusing too much on a high yield that might be a trap) and the power of dividend growth stocks as some of the best winners. Here are some key things to look for when investing in dividend stocks.
- Identify dividend stocks that meet your criteria. You may be looking for yield, a history of dividend growth, and so forth.
- Research the history of earnings growth. Dividend growth is sustainable only if a company's earnings have also steadily grown at a similar or higher rate over time.
- Consider valuation. While paying a modest premium for a high-quality business can sometimes be justified, overpaying can significantly weigh on long-term returns.
- Determine position sizing. Consider how much exposure you want to a particular stock, how much income you expect it to generate, and other factors to ensure you buy an appropriate amount.
- Focus on the long term. Dividend stocks deliver best when bought and held for many years. Having patience and letting exceptional managers run great companies while you just sit back and own them is how you get the best returns from dividend stocks.
Related investing topics
Dividend stocks vs. funds
Dividend stocks vs. dividend funds
Dividend stocks and dividend funds are both popular ways to generate income and potentially grow your investments. Dividend funds, such as mutual funds and exchange-traded funds (ETFs), invest in a portfolio of multiple dividend stocks. Dividend funds offer diversification and professional oversight by investment managers who carefully select the underlying stocks. With a dividend fund, it's important to pay attention to the expense ratio to determine how much of your investment may go towards fees.
Dividend stocks provide the potential for higher returns but also higher risk. It also takes time and effort to carefully research each business so you can understand whether it is a good fit for your portfolio. Depending on your investing style, you might prefer investing in dividend funds for the instant diversification and exposure they provide to a wide range of income stocks vs. putting cash to work in individual businesses. However, both types of investments can offer advantageous returns for a long-term investor with a well-diversified portfolio.
Best sectors
Best sectors for dividend investing
Dividend investors often prefer to focus on companies in a range of sectors with stable cash flows and predictable earnings. The best sectors can offer different advantages, from high yields to steady dividend growth.
However, the right mix really does depend on your investment goals. The utilities, energy, healthcare, consumer goods, and financial sectors contain some of the top dividend-paying companies to consider.
FAQ
Best dividend stocks: FAQ
What stocks pay the highest dividend?
While chasing yield can often lead to bad outcomes, some stocks are just built to be yield machines. Two categories known for paying above-average yields are utilities and REITs, or real estate investment trusts. But just as with any other dividend stock, don't assume that the highest-yielding ones are the best. Be sure to evaluate business quality and whether a company's cash flows support a dividend.
What are dividends in stocks?
Dividends are payments made by a company to its shareholders. U.S. companies typically pay dividends quarterly, though some pay less often, and a few even pay monthly.
Dividends are generally paid in cash, but some companies pay in "scrip," which is dividends paid in stock. Note that this is not the same as a dividend reinvestment plan, or DRIP, where a company (or your brokerage) automatically takes your cash dividend and purchases shares for you.
What is considered a good stock dividend?
It can vary by sector and even particular industries within a sector, but the most important answer is "one that can be sustained." This is why chasing yield is so dangerous, as a high yield that can't be maintained is no good at all.
A useful metric for determining a dividend's safety is the dividend payout ratio, which is the percentage of a company's earnings that it pays out in dividends. The safest dividends generally have the lowest payout ratios.
Is it a good idea to buy dividend stocks?
Whether you're looking for income or just the best possible total returns, chances are good that many dividend stocks can be ideal ways to reach your financial goals. Just remember that yield is often less important than other factors, such as a company's ability to maintain and grow the payout for the long term.
How do dividends work?
A dividend occurs when a company sends money (or stock, though very rarely) to its shareholders. When a company reaches the point that it consistently earns more than management can effectively reinvest, establishing a dividend policy and sending those excess profits back to investors is a smart move.
Do ETFs pay dividends?
Yes, many ETFs pay dividends. Dividend ETFs hold stocks that pay dividends, and the ETF then distributes those dividends to its investors.
Does it matter when you buy a dividend stock?
When you buy dividend stocks, it matters if you purchase them before the ex-dividend date. To receive the next dividend payment, you need to own the stock on or before the ex-dividend date.
