In this article, we will take a look at some of the best dividend leaders.
Investors have long favored dividend stocks for their financial strength and solid returns, which have historically outpaced many other asset classes. Although they may be underperforming right now, their long-term gains continue to make them appealing. Building wealth through dividends takes time, as the benefits come gradually rather than immediately.
A report by Hartford Funds underscores the value of dividends over time. Since 1960, reinvested dividends and compounding have contributed to 85% of the total return in the broader market. The report also noted that in decades like the 1940s, 1960s, and 1970s— when overall returns were below 10%— dividends played a key role in driving investor gains.
Dividend-paying stocks are especially popular during economic slowdowns or market volatility. Companies in sectors like utilities and consumer staples tend to deliver reliable earnings regardless of market conditions. However, during bull markets, these stocks often lag behind, as seen since 2020 when large tech firms have led market surges.
Overall, dividend stocks remain a popular choice for investors because of the stability and downside protection they offer. Given this, we will take a look at some of the best dividend leaders to invest in.
Our Methodology:
For this list, we scanned holdings of First Trust Morningstar Dividend Leaders Index Fund (FDL), which tracks the performance of the 100 highest-yielding stocks with consistent growth in dividends and can maintain their dividends in the future. From this list, we further refined our selection criteria by picking stocks across a range of different industries. We then ranked these stocks according to hedge funds having stakes in them, as per Insider Monkey’s Q1 2025.
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. Hormel Foods Corporation (NYSE:HRL)
Number of Hedge Fund Holders: 37
Hormel Foods Corporation (NYSE:HRL) is one of the best dividend leaders. On June 23, Goldman Sachs started coverage of Hormel with a Buy rating and set a price target of $35. The firm highlighted the company’s “strong protein demand” as a key reason for its positive view.
Goldman also pointed to Hormel’s robust packaged food lineup, featuring a variety of brands, price ranges, and options across important protein categories, as the main drivers of its optimistic stance. The firm made the following comment:
“We expect near-term supply reductions in turkey to support our Buy rating on HRL, along with its solid packaged food portfolio, including a recovery in its Planters nut business.”
Hormel Foods Corporation (NYSE:HRL) is a solid dividend company, having raised its dividends for 59 consecutive years. The company currently offers a quarterly dividend of $0.29 per share and has a dividend yield of 3.76%, as of June 23.
9. Archer-Daniels-Midland Company (NYSE:ADM)
Number of Hedge Fund Holders: 39
Archer-Daniels-Midland Company (NYSE:ADM) is among the best dividend leaders. The company is undertaking a strategic plan focused on boosting profitability, targeting $200–$300 million in cost savings over the next few years through operational streamlining and workforce reductions. These steps are designed to strengthen margins and bolster financial stability amid persistent economic headwinds.
This initiative may also support Archer-Daniels-Midland Company (NYSE:ADM)’s dividend. The company has raised its dividend annually for 52 consecutive years and has maintained uninterrupted quarterly payouts for 90 years. Strong underlying business fundamentals further back the stability of its dividend. At the end of the most recent quarter, the company had over $864 million available in cash and cash equivalents. It currently offers a quarterly dividend of $0.51 per share and has a dividend yield of 3.86%, as of June 23.
Archer-Daniels-Midland Company (NYSE:ADM) plays a vital role in the global agricultural supply chain, helping ensure food security by linking local demands with worldwide resources and capabilities.
