When it comes to investing, dividends are a key consideration for many people, and the best dividend stocks can be a mainstay of many portfolios. After all, who doesn’t love receiving extra income?
There are a lot of different dividend stocks out there, and it can be difficult to know which ones are the best. That’s exactly why we’ve created this guide – to help you find the best dividend stocks for your portfolio.
- What dividends are and how they work
- The benefits of investing in dividend stocks
- The different types of dividend stocks
- How to choose the best dividend stocks for your portfolio
What Are Dividend Stocks In Simple Terms
Dividends are payments made by a corporation to its shareholders, usually as a distribution of profits. They are typically paid out quarterly, though some companies also pay dividends annually or semi-annually.
For investors, dividends can provide a source of income, as well as offer the potential for capital gains if the stock price increases. There is also a huge benefit to the reinvestment of dividends back into repurchases as a way to grow your overall portfolio.
The best stocks do not always pay dividends, and the best dividend stocks are not always the best stocks for growth; but there are some stocks that feature on both lists.
Best Dividend Stocks -> Top 10 To Consider
The best dividend stocks to invest in are those that have a long history of paying dividends and have increased their dividends over time. They should also be companies that are financially strong and have a solid business model. Here are 10 of the best dividend stocks to buy for the long-term
1. Johnson & Johnson (NYSE: JNJ)
Johnson & Johnson is a company that needs no introduction. It is a diversified healthcare conglomerate with businesses ranging from consumer products to medical devices and pharmaceuticals. The company has an impressive track record of dividend growth, having raised its dividends for 54 consecutive years.
2. 3M Co (NYSE: MMM)
3M is a diversified technology company with operations in over 60 countries. The company is a leader in many different businesses, including industrial, healthcare, and consumer products. 3M has increased its dividends for 63 consecutive years, making it one of the best dividend stocks to buy for long-term reinvestment.
3. Abbott Laboratories (NYSE: ABT)
Abbott Laboratories is a leading global healthcare company with businesses in pharmaceuticals, diagnostics, and medical devices. The company has a strong track record of dividend growth, having raised its dividends for 43 consecutive years.
4. Procter & Gamble Co (NYSE: PG)
Procter & Gamble is a diversified consumer goods company with operations in over 180 countries. The company manufactures and sells a wide variety of household products, including food, beverages, beauty and grooming products, and health care products.
Procter & Gamble has increased its dividends for 59 consecutive years, making it one of the best dividend stocks to buy for long-term investors or income seekers.
5. Nestle SA (OTC: NSRGY)
Nestle is the world’s largest food and beverage company with operations in over 190 countries. The company sells a wide variety of food and beverage products, including coffee, tea, baby food, bottled water, pet food, and frozen foods. Nestle has increased its dividends for 46 consecutive years, making it one of the best dividend stocks of recent history.
6. PepsiCo Inc (NYSE: PEP)
PepsiCo is a global food and beverage company with operations in over 200 countries. The company sells a wide variety of carbonated and non-carbonated beverages, as well as snacks and other food products. PepsiCo has increased its dividends for 45 consecutive years and is a consistent name on many income seekers lists.
7. Coca-Cola Co (NYSE: KO)
Coca-Cola is a global beverage company with operations in over 200 countries. The company manufactures and sells a wide variety of carbonated and non-carbonated beverages, including soda, water, juices, and sports drinks. Coca-Cola has increased its dividends for 53 consecutive years, making it one of the best dividend stocks to buy for long-term holders.
8. IBM (NYSE: IBM)
IBM is a global technology company with a presence in more than 170 countries. The company provides a wide range of products and services, including cloud computing, artificial intelligence, and enterprise software. IBM has increased its dividends for 21 consecutive years, earning it a place as one of the best dividend stocks.
9. Emerson Electric Co (NYSE: EMR)
Emerson Electric is a diversified technology and manufacturing company with operations in over 150 countries. The company provides a wide range of products and services, including industrial automation, climate control, and tools and storage. Emerson Electric has increased its dividends for 64 consecutive years, making it one of the best dividend stocks to buy for long-term investment.
Best Dividend Paying Stocks Sectors
Dividends are a popular way for investors to earn income from their investments. But not all companies pay dividends, and those that do may not always offer the best dividend yields. So, what kind of companies usually pay the best dividends?
There are a few different types of companies that tend to offer high dividend yields. First, there are utility companies. These companies typically have a lot of debt and are required by law to maintain a certain level of profitability. As a result, they often have high dividend yields.
Another type of company that tends to offer high dividends is a real estate investment trust (REIT). These companies own and operate income-producing real estate properties. They are required by law to distribute most of their profits to shareholders in the form of dividends. As a result, they often have high dividend yields.
Finally, there are companies in certain industries that have a history of paying high dividends. These include companies in the financial, energy, and healthcare sectors. While these companies may not always offer the highest dividend yields, they tend to be more reliable dividend payers than other types of companies.
So, if you’re looking for stocks with high dividend yields, utility companies, REITs, and companies in certain other industries are usually your best bet.