In this article, we will take a look at some of the best income stocks to buy now.
Amid concerns over trade restrictions and a weakening economy, some investors are seeking stability in dividend-paying stocks—a traditional defensive strategy. While safe-haven assets like gold and US Treasurys have seen increased demand and more economically sensitive stocks such as small caps and financials have faced outflows, many favor dividend stocks for their dual benefits: the potential for capital appreciation and the steady income from dividends, which can help offset market declines.
This renewed interest comes after a challenging period for dividend stocks. Rising interest rates had made bonds more appealing to income-seeking investors, while excitement around artificial intelligence propelled growth stocks—especially the Magnificent Seven tech names—to new heights, leaving many established dividend-paying firms overlooked.
Analysts also support dividend stocks for income portfolios, especially in times of market volatility. Financial advisor Michael Dinich discussed dividend investing in an interview with Business Insider. Here are some comments from the analyst:
“While low-cost index funds provide easily diversified exposure to the market with minimal effort, selecting individual dividend payers demands continued research to find suitable candidates.”
He pointed out that dividend-paying stocks can be a dependable source of income, offering investors the flexibility to either reinvest the proceeds for compounding growth or use the cash to meet financial obligations. This feature makes dividend stocks particularly appealing to younger investors, as they provide steady income along with exposure to the broader market. His remarks echoed the long-term significance of dividends in overall market returns. Data from S&P Dow Jones Indices showed that between 1926 and July 2023, dividends made up 32% of the total monthly return of the broader market, with the rest coming from price gains.
Research from WisdomTree also underlined the strong income-generating capacity of dividend-paying stocks. Their analysis indicated that a dividend-focused strategy could enhance investors’ income and improve the trailing 12-month dividend yield. This method becomes even more useful during times of low interest rates and heightened market volatility. Allocating investments to dividend-weighted indexes may therefore offer a consistent income strategy in uncertain market environments.
With investor interest in dividends on the rise, companies across the US and globally are steadily boosting their payouts. In 2024, global dividend payments reached a record $1.75 trillion, according to the Janus Henderson Global Dividend Index, reflecting a 6.6% increase on an underlying basis. Headline growth came in at 5.2%, slightly lower due to fewer special dividends and a stronger US dollar. The total slightly surpassed Janus Henderson’s earlier projection of $1.73 trillion, thanks to better-than-expected performance in the US and Japan during the final quarter, when Q4 dividends rose 7.3% on an underlying basis.
Throughout the year, solid growth was also seen in Europe, with emerging markets like India and parts of Asia, including Singapore and South Korea, showing respectable increases. Out of 49 countries tracked, 17—including major contributors like the US, Canada, France, Japan, and China—hit record dividend levels. The report noted that 88% of companies either raised or maintained their dividends, with the median increase coming in at 6.7%.
Looking ahead, Janus Henderson forecasts global dividends will rise by 5.0% in headline terms in 2025, reaching another all-time high of $1.83 trillion. When adjusting for currency effects, underlying growth is expected to be around 5.1%. Given this, we will take a look at some of the best dividend stocks for regular income.
Image by Steve Buissinne from Pixabay
Our Methodology
For this article, we used a stock screener to pick companies that have raised their dividends for at least 10 consecutive years or more. The consistent dividend growth reflects the reliability of these stocks as income-generating investments for shareholders. From that group, we picked companies with the highest number of hedge fund investors, as per Insider Monkey’s database of Q4 2024. The stocks are ranked in ascending order of the number of hedge funds having stakes in them.
At Insider Monkey, we are obsessed with hedge funds. 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. The Procter & Gamble Company (NYSE:PG)
Number of Hedge Fund Holders: 79
The Procter & Gamble Company (NYSE:PG) is a leading American multinational consumer goods company that benefits from its broad scale and strong position across multiple product categories. Its wide-ranging lineup of popular brands—spanning beauty, grooming, health, home and fabric care, and baby products—helps reduce exposure to risk and supports its global presence.
In fiscal Q3 2025, The Procter & Gamble Company (NYSE:PG) delivered mixed results. Earnings per share came in at $1.54, just shy of expectations by $0.01, while revenue declined 2.07% year-over-year to $19.78 billion, missing projections by $376.3 million. Management attributed the softer performance to ongoing consumer and geopolitical headwinds, noting they are adjusting their near-term outlook to reflect current conditions but remain optimistic about the long-term prospects for their brands and markets.
The Procter & Gamble Company (NYSE:PG) generated $3.7 billion in operating cash flow for the quarter and posted $3.8 billion in net income. Adjusted free cash flow productivity was 75%. Shareholder returns totaled $3.8 billion, split between $2.4 billion in dividends and $1.4 billion in stock buybacks. In April, the company declared another dividend increase—its 69th consecutive annual hike—continuing a 135-year streak of uninterrupted dividend payments since its founding in 1890. It now pays a quarterly dividend of $1.0568 per share and has a dividend yield of 2.68%, as of May 9.
9. QUALCOMM Incorporated (NASDAQ:QCOM)
Number of Hedge Fund Holders: 79
QUALCOMM Incorporated (NASDAQ:QCOM) is a California-based multinational company that creates semiconductor, software, and services related to wireless technology. The company has a solid long-term strategy in motion, aiming to broaden its business beyond its core strength in smartphones. It is expanding into new areas like PC processors and Internet of Things (IoT) devices. A key area of potential growth lies in industrial automation, where Qualcomm plans to leverage its mobile technology experience to bring AI capabilities to manufacturing systems.
QUALCOMM Incorporated (NASDAQ:QCOM) reported strong earnings in its fiscal Q2 2025. The company posted revenue of $10.8 billion, which showed a 15.4% growth from the same period last year. The revenue surpassed analysts’ estimates of $178.6 million. The company’s EPS of $2.85 also surpassed analysts’ consensus by $0.03. Its net income came in at $3.17 billion, which jumped by 15% from the prior-year period.
In addition to reporting growth on various fronts, QUALCOMM Incorporated (NASDAQ:QCOM)’s cash position also remained solid. The company ended the quarter with $7.2 billion available in cash and cash equivalents. It also generated $7.1 billion in operating cash flow. The company’s commitment to shareholder return can be seen from its $2.7 billion distribution to investors during the quarter, which included $938 million of dividends. Its quarterly dividend comes in at $0.89 per share for a dividend yield of 2.45%, as of May 9. With a 21-year dividend growth streak under its belt, QCOM is one of the best dividend stocks on our list.
8. The Coca-Cola Company (NYSE:KO)
Number of Hedge Fund Holders: 81
An American multinational beverage company and Warren Buffett’s favorite, The Coca-Cola Company (NYSE:KO) ranks eighth on our list of the best dividend stocks for income portfolios. The company recently announced its earnings for the first quarter of 2025 and posted revenue of $11.22 billion, which, though, fell slightly by 0.13% YoY, beat analysts’ estimates by$58.05 million. Its EPS came in at $0.73, which also surpassed the consensus by $0.01.
In its earnings report, The Coca-Cola Company (NYSE:KO) noted that although certain developed markets experienced headwinds, its broad international presence enabled it to effectively manage a challenging external landscape. Management emphasized that by staying aligned with its mission and maintaining a strong connection to consumers, the company remains confident in its capacity to generate sustainable long-term value. In addition, it reported an increase in value share within the total nonalcoholic ready-to-drink (NARTD) beverage category.
On May 1, The Coca-Cola Company (NYSE:KO) declared a quarterly dividend of $0.51 per share, which was in line with its previous dividend. Overall, the company has been rewarding shareholders with growing dividends for the past 63 years, which makes it a Dividend King. As of May 9, the stock has a dividend yield of 2.89%.
7. NextEra Energy, Inc. (NYSE:NEE)
Number of Hedge Fund Holders: 84
NextEra Energy, Inc. (NYSE:NEE) is a Florida-based leading force in the renewable energy industry. The company operates Florida Power & Light (FPL), one of the largest electric utilities in the country, and oversees a major global renewable energy business through NextEra Energy Resources. These core operations generate reliable cash flow, enabling the company to fund dividends and invest in long-term growth opportunities.
In the first quarter of 2025, NextEra Energy, Inc. (NYSE:NEE) delivered strong financial performance, with revenue climbing to $6.25 billion, up 9% from the same period a year earlier. Adjusted earnings per share also grew by nearly 9% year-over-year, a solid result for a utility company. This momentum was fueled by robust results from both FPL and the renewable energy segment. FPL alone contributed $1.3 billion in adjusted net income, or $0.64 per share—an increase of over 12% from the prior year. The company remains focused on targeted capital investments to address Florida’s growing energy needs while keeping electricity rates reasonable.
NextEra Energy, Inc. (NYSE:NEE) also ended the quarter in a strong financial position, with more than $2.4 billion in cash and cash equivalents and $2.77 billion in operating cash flow, reinforcing its reputation as a dependable dividend payer. The company holds a 29-year track record of dividend growth, which makes it one of the best income stocks. Currently, it offers a quarterly dividend of $0.5665 per share and has a dividend yield of 3.22%, as of May 9.
6. Cisco Systems, Inc. (NASDAQ:CSCO)
Number of Hedge Fund Holders: 84
Cisco Systems, Inc. (NASDAQ:CSCO) is a California-based global leader in digital communications technology, offering a wide range of networking hardware, software, and telecom equipment. The company remains a dominant force in enterprise networking, excelling in areas such as switching, routing, and wireless access, while also expanding its presence in cybersecurity and collaboration tools. As more companies transition to hybrid cloud setups and flexible work models, Cisco is well-positioned to capitalize on these trends through its integrated and secure networking solutions that give it a competitive edge.
In the second quarter of fiscal 2025, Cisco Systems, Inc. (NASDAQ:CSCO) reported results that exceeded expectations. Adjusted earnings came in at $0.94 per share on revenue of $13.99 billion, beating forecasts of $0.91 per share and $13.87 billion in revenue. Year-over-year, revenue rose by 9.4%, aided by $350 million in AI-related infrastructure orders. The company also saw a 29% increase in total product orders compared to the prior year, or 11% growth excluding the impact of its acquisition of Splunk.
Cisco Systems, Inc. (NASDAQ:CSCO) also reported a substantial boost in cash generation. Operating cash flow jumped 177% year-over-year to $2.2 billion, up from $800 million in the same quarter last year. The company ended the quarter with nearly $17 billion in cash and cash equivalents and has maintained 18 consecutive years of dividend growth, which makes it one of the best dividend stocks. It offers a quarterly dividend of $0.41 per share and has a dividend yield of 2.74%, as of May 9.
5. AbbVie Inc. (NYSE:ABBV)
Number of Hedge Fund Holders: 85
AbbVie Inc. (NYSE:ABBV) is an American pharmaceutical company that focuses on research and innovation, developing and marketing treatments for a range of chronic and serious health conditions.
AbbVie Inc. (NYSE:ABBV) reported strong earnings in the first quarter of 2025. The company posted revenue of $13.3 billion, which saw an 8.3% growth from the same period last year and also beat analysts’ estimates by $422 million. The company’s immunology division continued to perform strongly, with Skyrizi and Rinvoq delivering enough growth to offset the expected drop in Humira sales. Solid results were also seen in the neuroscience and oncology segments, with Elahere standing out by bringing in $179 million in global revenue. A major driver of this success was the positive outcome of the MIRASOL trial, where Elahere showed a clear advantage over chemotherapy in treating ovarian cancer, cutting the risk of death by 32% and the risk of disease progression or death by 37%.
AbbVie Inc. (NYSE:ABBV) is solidifying its reputation as an active acquirer through several recent deals. These include the purchase of ImmunoGen to gain control of Elahere, the acquisition of Nimble Therapeutics to expand its autoimmune pipeline, and a licensing agreement with Gubra focused on obesity treatments—a competitive space currently led by Eli Lilly and Novo Nordisk.
AbbVie Inc. (NYSE:ABBV), one of the best dividend stocks, currently offers a quarterly dividend of $1.64 per share for a dividend yield of 3.55%, as of May 9. The company has been growing its dividend payouts for 52 consecutive years.
4. Merck & Co., Inc. (NYSE:MRK)
Number of Hedge Fund Holders: 91
Merck & Co., Inc. (NYSE:MRK) ranks fourth on our list of the best dividend stocks for income portfolios. The New Jersey-based multinational pharmaceutical company offers a wide range of related products and services to its consumers.
Merck & Co., Inc. (NYSE:MRK)’s $3.9 billion acquisition of SpringWorks Therapeutics represents its biggest transaction since 2019 and highlights the company’s effort to strengthen its healthcare portfolio in anticipation of upcoming patent losses. The deal, priced at $47 per share in cash—a 26% premium—gives Merck access to two FDA-approved therapies along with a promising development pipeline. The acquisition is projected to start boosting earnings by 2027 and has the potential to deliver up to $1.6 billion in annual revenue by 2030, offering a meaningful and expandable source of growth.
In the first quarter of 2025, Merck & Co., Inc. (NYSE:MRK) reported revenue of $15.5 billion, which fell by 2% from the same period last year. However, the revenue surpassed analysts’ estimates by $198.2 million. The company posted a net income of $5.6 billion, which grew by 6% on a YoY basis. It reported a 4% increase in sales of its blockbuster cancer drug Keytruda, which generated $7.2 billion during the period. Its Animal Health division also delivered solid results, with sales rising 5% to reach $1.6 billion.
Merck & Co., Inc. (NYSE:MRK) currently pays a quarterly dividend of $0.81 per share and has a dividend yield of 4.26%, as of May 9. The company has raised its dividends for 14 years in a row, becoming a reliable choice for income investors.
3. Union Pacific Corporation (NYSE:UNP)
Number of Hedge Fund Holders: 93
Union Pacific Corporation (NYSE:UNP) is a Nebraska-based railroad company that transports a wide range of goods and commodities, providing exposure to multiple industries, including agriculture, automotive, and energy. The company is one of the two primary rail carriers operating along the US West Coast, with an extensive network that plays a vital role in linking major Pacific ports to the rest of the country. This strategic positioning makes it essential for moving goods arriving from Asia across the United States.
In the first quarter of 2025, Union Pacific Corporation (NYSE:UNP)’s revenue came in at $6.03 billion, which remained flat as 7% growth in volume and strong core pricing gains were offset by an unfavorable business mix, reduced fuel surcharge revenue, lower other income, and the effects of the leap year. Freight revenue rose by 1%, while freight revenue excluding fuel surcharges increased by 4%. Core pricing gains, after accounting for inflation, positively contributed to the operating ratio. The operating ratio held steady at 60.7% year over year, though lower fuel costs and the leap year had a 90-basis-point negative impact.
Union Pacific Corporation (NYSE:UNP)’s cash position came in strong. The company ended the quarter with $1.4 billion in cash and cash equivalents. In addition, it generated $2.2 billion in operating cash flow. It is one of the best dividend stocks on our list, as the company has paid regular dividends for 125 years, while growing its payouts for 18 years. The company’s quarterly dividend comes in at $1.34 per share and has a dividend yield of 2.48%, as of May 9.
2. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 98
Johnson & Johnson (NYSE:JNJ) is a leading US-based multinational focused on pharmaceuticals, biotech, and medical technology. The company reported solid first-quarter 2025 results. Revenue reached $21.9 billion, up 2.4% from the same period last year and beating expectations by $315.6 million. Net income surged to $11 billion, marking a year-over-year increase of 238%.
Johnson & Johnson (NYSE:JNJ) made notable strides in innovation during the quarter, pushing forward key pipeline projects such as TREMFYA for inflammatory bowel disease, a drug combination involving RYBREVANT and LAZCLUZE for treating non-small-cell lung cancer, and progress with OTTAVA, its robotic surgery platform. It also broadened its neuroscience capabilities through the acquisition of Intra-Cellular Therapies.
From a dividend point of view, Johnson & Johnson (NYSE:JNJ) remained financially strong, generating $3.4 billion in free cash flow, up from $2.8 billion the year before. On April 15, the company raised its quarterly dividend by 4.8% to $1.30 per share, marking its 63rd straight year of dividend growth. The stock supports a dividend yield of 3.37%, as of May 9.
1. Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund Holders: 115
Eli Lilly and Company (NYSE:LLY) is an American multinational pharmaceutical company. The company continues to strengthen its standing as a major player in the healthcare industry, particularly through its leadership in the obesity and diabetes treatment markets. In its first-quarter 2025 results, the company reported a 45% year-over-year increase in revenue, reaching $12.7 billion. This surge was largely fueled by the exceptional performance of its GLP-1-based therapies, Mounjaro and Zepbound. These two drugs have significantly reshaped the company’s growth trajectory, positioning it as a front-runner in the rapidly expanding obesity treatment sector, alongside Novo Nordisk.
Eli Lilly and Company (NYSE:LLY)’s emphasis on high-demand, high-margin treatments is proving effective, as reflected in a 29% increase in non-GAAP earnings per share to $3.34 and an improved gross margin of 83.5%. These figures point to strong product demand, supported by efficient cost management and solid operating leverage. The company’s long-term investment of $50 billion since 2020 underscores its commitment to scaling operations and addressing rising global healthcare needs.
Eli Lilly and Company (NYSE:LLY) is a strong dividend payer, having raised its payouts for 11 consecutive years, which makes it one of the best dividend stocks on our list. The company offers a quarterly dividend of $1.50 per share and has a dividend yield of 0.82%, as of May 9.
Overall, Eli Lilly and Company (NYSE:LLY) ranks first on our list of the best income stocks to buy now. While we acknowledge the potential of LLY as an investment, our conviction lies in the belief that some deeply undervalued dividend stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued dividend stock that is more promising than LLY but that trades at 10 times its earnings and grows its earnings at double digit rates annually, check out our report about the dirt cheap dividend stock.
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