In this article, we will take a look at some of the best dividend stocks to buy.
Dividend stocks have long been favored by investors for their potential to deliver solid returns over time, often outperforming the broader market.
Research shows that dividends have played a significant role in total equity returns. According to a T. Rowe Price report, dividends have made up nearly one-third of US stock returns since 1926. Between 1980 and 2019, when interest rates were falling, dividends accounted for 75% of overall market returns. The report also noted that in low-interest-rate environments, dividends provide reliable income when other fixed-income investments may offer less appeal.
Experts advise investors to focus on companies with consistent dividend growth rather than simply chasing high yields. Morningstar strategist Dan Lefkovitz emphasized that dividend growth signals financial strength and a solid outlook, distinguishing it from high-yield investing. Given this, we will take a look at some of the best safe dividend stocks to invest in.
Photo by Vitaly Taranov on Unsplash
Our Methodology
To compile this list, we thoroughly reviewed reputable sources such as Forbes, Morningstar, Barron’s, and Business Insider. From their latest articles, we gathered the stocks they collectively favored. The companies mentioned below have strong dividend histories and robust balance sheets. In addition, we assessed the sentiment of hedge funds for each stock using Insider Monkey’s Q1 2025 database. The stocks are arranged in ascending order based on the number of hedge funds that hold stakes in these companies.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10. NNN REIT, Inc. (NYSE:NNN)
Number of Hedge Fund Holders: 26
NNN REIT, Inc. (NYSE:NNN), formerly known as National Retail Properties, stays true to its original focus— owning and managing retail real estate. The company primarily invests in high-quality retail properties under long-term net leases, which typically require minimal capital outlays. As of March 31, 2025, NNN REIT held 3,641 properties across all 50 states, covering around 37.3 million square feet of leasable space, with an average remaining lease term of 10 years.
NNN REIT, Inc. (NYSE:NNN) boasts a strong history of dividend increases, having raised its payout for 36 consecutive years as of 2024, an achievement matched by only two other REITs and fewer than 80 publicly traded companies in the US. On July 15, the company declared a 3.4% hike in its quarterly dividend to $0.60 per share. The stock supports a dividend yield of 5.64%, as of July 27.
NNN REIT, Inc. (NYSE:NNN) remains well-positioned to maintain its high-yield dividend growth. It maintains a low payout ratio— under 70% of funds from operations (FFO)— and operates with a conservative balance sheet and below-average leverage. These factors provide the company with the financial flexibility to continue acquiring income-generating retail assets.
9. Black Hills Corporation (NYSE:BKH)
Number of Hedge Fund Holders: 27
Black Hills Corporation (NYSE:BKH) is among the best dividend stocks on our list. The company stands out as one of the few utility companies to earn Dividend King status, even though it’s relatively small, with a market cap of about $4.1 billion.
Black Hills Corporation (NYSE:BKH) has been expanding its customer base at a pace nearly three times faster than the U.S. population growth, a promising sign that may help it continue gaining regulatory approval for its investment strategies and rate plans. This growth trend supports the company’s long-term objective of achieving 4% to 6% annual earnings growth, with dividend increases expected to follow a similar path.
On July 23, Black Hills Corporation (NYSE:BKH) declared a quarterly dividend of $0.676 per share, which was in line with its previous dividend. Overall, the company has been rewarding shareholders with growing dividends for the past 55 years. The stock has an attractive dividend yield of 4.77%, as of July 27.
8. Enterprise Products Partners L.P. (NYSE:EPD)
Number of Hedge Fund Holders: 31
Enterprise Products Partners L.P. (NYSE:EPD) is the kind of stable investment investors can rely on for the long haul. It’s known for its dependable performance, with about 85% of its cash flow coming from fee-based contracts that often include take-or-pay terms and inflation protections. This setup helps keep earnings steady regardless of energy market fluctuations.
Enterprise Products Partners L.P. (NYSE:EPD) maintains a conservative financial approach, finishing the last quarter with a leverage ratio slightly above 3 and a strong distribution coverage of 1.7 times. Thanks to its solid cash flow, Enterprise can fund most of its growth projects internally without needing to frequently raise additional capital.
Enterprise Products Partners L.P. (NYSE:EPD) does not overlook potential growth opportunities. This year, the company expects to invest between $4 billion and $4.5 billion in expansion projects, a notable increase from the $1.6 billion spent in 2022. These investments generally yield strong results, with the company earning an average return on invested capital of approximately 13%.
On July 9, Enterprise Products Partners L.P. (NYSE:EPD) declared a 2% hike in its quarterly dividend to $0.545 per share. This marked the company’s 27th consecutive year of dividend growth. As of July 27, the stock has a dividend yield of 6.91%.
7. Realty Income Corporation (NYSE:O)
Number of Hedge Fund Holders: 32
Realty Income Corporation (NYSE:O) is among the best safe dividend stocks to invest in, as the company offers monthly dividends to shareholders. The company owns a vast portfolio of over 15,600 properties. While it primarily focuses on net lease retail assets, it also includes industrial properties and has operations spread across North America and Europe, making it a well-diversified business.
Realty Income Corporation (NYSE:O)’s large scale allows it to access capital markets with ease. In addition, its investment-grade credit rating helps it secure favorable borrowing terms. This results in a competitive cost of capital, giving Realty Income an advantage over many of its peers.
On July 8, Realty Income Corporation (NYSE:O) announced a monthly dividend of $0.269 per share, consistent with its prior payout. Since it was founded about 30 years ago, it has increased its dividend 131 times. In addition, shareholders have received monthly dividends for 661 straight months. The stock supports a dividend yield of 5.58%, as of July 27.
6. The Southern Company (NYSE:SO)
Number of Hedge Fund Holders: 55
The Southern Company (NYSE:SO) holds a strong position as a leading player in nuclear energy. Its subsidiary, Southern Nuclear, manages eight nuclear units across three facilities, including the recently completed Vogtle Units 3 and 4, which mark the first newly built commercial nuclear units in the US in nearly 30 years.
Through its various subsidiaries, The Southern Company (NYSE:SO) is involved in power generation, transmission, electric and gas utilities, nuclear operations, and telecom. It expects power demand to grow at an annualized rate of 8% through 2029, which supports projected long-term earnings-per-share growth of 5% to 7% annually, more than enough to support ongoing dividend increases.
The Southern Company (NYSE:SO) has a strong history of dividend reliability, having raised its dividend for 24 years in a row and maintaining uninterrupted payments for the past 78 years without any cuts, which makes it one of the best dividend stocks to invest in. Currently, the company offers a quarterly dividend of $0.74 per share and has a dividend yield of 3.10%, as of July 27.
5. International Business Machines Corporation (NYSE:IBM)
Number of Hedge Fund Holders: 57
International Business Machines Corporation (NYSE:IBM) is a dividend-paying firm that has gained from its substantial involvement in the artificial intelligence (AI) sector. Between the second quarter of 2023 and the first quarter of 2025, IBM expanded its generative AI business, which refers to the total value of active contracts and orders it has obtained, to $6 billion.
International Business Machines Corporation (NYSE:IBM) reported strong earnings in the second quarter of 2025. The company posted revenue of $16.98 billion, which showed a 7.6% growth from the same period last year. The revenue also beat analysts’ estimates by $385.4 million. The company maintains a strong position in the market due to its deep-rooted innovation and industry expertise— two key elements that help clients implement and scale AI effectively. The company’s generative AI business has continued to grow and now exceeds $7.5 billion.
International Business Machines Corporation (NYSE:IBM)’s cash position also remained strong, which makes it one of the best safe dividend stocks to invest in. The company generated $6.1 billion YTD, and its free cash flow amounted to $4.8 billion. During the quarter, it returned $1.6 billion to shareholders through dividends. The company pays a quarterly dividend of $1.68 per share and has a dividend yield of 2.59%, as of July 27. IBM has rewarded its shareholders with growing dividends for 30 years in a row.
4. U.S. Bancorp (NYSE:USB)
Number of Hedge Fund Holders: 63
U.S. Bancorp (NYSE:USB) is among the best dividend stocks to invest in. It is a broad-based financial services provider, offering a wide range of solutions across consumer and commercial banking, wealth management, payment processing, and corporate finance. The bank caters to individuals, businesses, and institutions nationwide, providing services that include basic bank accounts as well as advanced financial tools like treasury management for large corporations.
U.S. Bancorp (NYSE:USB) recently reported earnings for the second quarter of 2025, posting revenue of $7 billion, which showed a 2% growth from the same period last year. Its net income came in at $1.815 billion for the quarter, marking a 13.2% increase compared to the same period last year. Diluted earnings per share rose to $1.11 from $0.97 in the second quarter of 2024. The company achieved a return on tangible common equity of 18.0%, a return on average assets of 1.08%, and posted an efficiency ratio of 59.2%.
U.S. Bancorp (NYSE:USB) announced on July 1 that it intends to raise its quarterly dividend by 4%, increasing it from $0.50 to $0.52 per share. The decision follows the company’s successful performance in the Federal Reserve’s stress test. Alongside the dividend hike, the company also plans to move forward with share repurchases as part of its ongoing $5 billion buyback program.
U.S. Bancorp (NYSE:USB) currently offers a quarterly dividend of $0.50 per share and has a dividend yield of 4.32%, as of July 27. The company has raised its payouts for 14 years in a row.
3. Medtronic plc (NYSE:MDT)
Number of Hedge Fund Holders: 63
Medtronic plc (NYSE:MDT) is among the best dividend stocks to invest in. The company showcases solid financial health with steady revenue, strong free cash flow, and reliable earnings. Its current dividend payout ratio stands at 53.14%, well below its 10-year average, indicating stronger earnings coverage. MDT remains committed to innovation, allocating $1.85 billion to advance technologies in cardiac care, diabetes, and surgical solutions, while also expanding its footprint in emerging markets and the Asia-Pacific region.
Offering a broad portfolio that spans cardiovascular, neuroscience, medical-surgical, and diabetes care, Medtronic plc (NYSE:MDT) integrates artificial intelligence and robotics to enhance its products. The company also plans to spin off its diabetes segment into a separate entity to unlock shareholder value.
With just two more dividend increases, Medtronic plc (NYSE:MDT) is on track to achieve Dividend King status. The company has grown its dividends for 48 years in a row. Currently, it offers a quarterly dividend of $0.71 per share and has a dividend yield of 3.06%, as of July 27.
2. Bristol-Myers Squibb Company (NYSE:BMY)
Number of Hedge Fund Holders: 69
Bristol-Myers Squibb Company (NYSE:BMY) presents a strong case for investors looking for both value and reliable income. While the company has faced challenges in the past, it has recently gained approval for several important new drugs, strengthening its outlook.
For dividend-focused investors, free cash flow is often a more meaningful indicator than earnings, as it excludes non-cash items that can distort the picture. In the previous year, Bristol-Myers Squibb Company (NYSE:BMY) generated $13.9 billion in free cash flow, well above the $4.9 billion it distributed in dividends. This substantial cushion suggests the company is well-positioned to maintain its dividend even in tougher times and gives it flexibility to reduce long-term debt if needed.
Bristol-Myers Squibb Company (NYSE:BMY) is one of the best dividend stocks, as the company has raised its payouts for 16 consecutive years. The company offers a quarterly dividend of $0.62 per share for a dividend yield of 5.12%, as of July 27.
1. ConocoPhillips (NYSE:COP)
Number of Hedge Fund Holders: 70
ConocoPhillips (NYSE:COP) ranks among the largest and most efficient oil and gas producers in the US. The company has built a strong and diverse asset base with decades of production potential, keeping its supply cost under $40 per barrel. With oil prices currently in the upper $60s, the company is generating significant free cash flow.
Its ongoing investments in Alaska and global LNG operations are expected to add $6 billion in additional free cash flow by 2029. This growth positions ConocoPhillips (NYSE:COP) as a leader in free cash flow expansion within the energy sector and supports its aim to be among the top 25% of S&P companies in dividend growth.
ConocoPhillips (NYSE:COP) currently pays a quarterly dividend of $0.78 per share and has a dividend yield of 3.29%, as recorded on July 27. It is among the safest dividend stocks to invest in as the company has raised its payouts for 10 consecutive years.
While we acknowledge the potential of COP to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than COP and that has 100x upside potential, check out our report about this cheapest AI stock.
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