In this article, we will take a look at the 10 Best S&P 500 Dividend Stocks to Buy Right Now.
Dividend stocks have long been an overlooked corner of the market. In recent years, they have struggled to keep pace with the broader market. Also, many Dividend Aristocrats have been forced to end their long-running streaks of dividend increases because of challenging conditions.
Even so, many experienced investors continue to look at dividend-paying stocks as a way to generate income and build long-term returns.
No income investor wants to see a company reduce its dividend. Still, Morgan Stanley sees a potential opportunity for patient shareholders. The firm noted that stocks can recover after an initial period of weakness following a dividend cut.
Dividend payments are often viewed as a reward for long-term investors. Companies may reduce those payouts when financial pressure builds. Rising interest rates can make matters worse, particularly for businesses carrying significant debt, since higher rates increase borrowing costs and the overall cost of capital.
That remains a key issue today. The Federal Reserve has not lowered interest rates since December 2025, leaving its benchmark rate between 3.5% and 3.75%. The outlook has become even more uncertain after May’s jobs report came in stronger than expected and inflation continued to rise. Those developments have led some market participants to consider the possibility that the Fed’s next move could be a rate increase rather than a cut.
Still, a dividend reduction is not always bad news for shareholders. According to Morgan Stanley strategist Todd Castagno, investors often sell these stocks aggressively during the first six months after a dividend cut. In a report released in late May, he said, “However, once the initial reaction gets priced in, an attractive entry point presents itself, and the stock tends to outperform as the company recovers and puts itself in a better financial position,” he added.
Given this, we will take a look at some of the best dividend stocks in the S&P 500.
Our Methodology:
For this list, we screened the S&P 500 list and identified companies with strong dividend policies, sound financials, and solid balance sheets. From that list, we selected those that were most popular among hedge funds, as per Insider Monkey’s database of Q1 2026. We limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment.
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. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
10. Chubb Limited (NYSE:CB)
Number of Hedge Fund Holders: 59
Barclays lowered its price recommendation on Chubb Limited (NYSE:CB) to $368 from $375 on June 12. The firm reiterated an Equal Weight rating on the stock. It said earnings upside in the property and casualty insurance sector is “becoming harder to find” as pricing softens, growth slows, and margin pressure increases. According to the analyst, pricing trends have come in weaker than expected, prompting insurers to scale back growth efforts to protect underwriting margins.
Earlier, on May 26, Piper Sandler raised its price goal on Chubb to $340 from $328. It kept a Neutral rating on the shares. The firm pointed to recent stock performance and the passage of time as reasons for the adjustment. Piper noted that it increased price targets for most insurance carriers while lowering targets for some insurance brokers. Its analysis follows a bottom-up approach. After reviewing first-quarter results, the firm said it may be more prudent to focus on insurance carriers rather than brokers. Underwriting performance provided stronger-than-expected support for carriers, while brokers posted organic growth results that were less encouraging.
Chubb Limited is a Switzerland-based holding company. Through its subsidiaries, the company offers a broad range of insurance and reinsurance products and services to clients worldwide.
9. Ecolab Inc. (NYSE:ECL)
Number of Hedge Fund Holders: 60
Wells Fargo analyst Jason Haas raised his price target on Ecolab Inc. (NYSE:ECL) to $275 from $260 on June 10 and maintained an Equal Weight rating on the stock. The firm recently met with IR executive Andy Hedberg at its Industrials Conference and left the discussion encouraged by Ecolab’s confidence in managing commodity cost pressures through its energy surcharge program. Wells Fargo also noted that the company’s growth engines, particularly its High-Tech business, continue to play an important role in driving growth.
Earlier, on May 27, UBS upgraded Ecolab Inc. to Buy from Neutral. It also increased its price target on the stock to $325 from $293. The firm expects the stock to move higher as investors gain confidence in Ecolab’s ability to accelerate pricing and recover raw material costs during the second half of 2026. UBS also believes the company is well-positioned to gain market share in consumer markets through its “OneECL” initiatives. The analyst added that Ecolab’s growing exposure to high-tech and other faster-growing industries could help lift annual volume growth to 4%, compared with its historical range of 1% to 2%.
Ecolab Inc. provides water, hygiene, and infection prevention solutions and services designed to protect people and the resources essential to life.
8. Colgate-Palmolive Company (NYSE:CL)
Number of Hedge Fund Holders: 62
Bernstein initiated coverage of Colgate-Palmolive Company (NYSE:CL) on June 12 with a Market Perform rating. It also set a $96 price target on the stock. Analyst Cristian Rios described Colgate as having the “most productive” geographic footprint among the companies under Bernstein’s coverage. According to the firm, the company has been able to balance geographic diversification with growth opportunities. Bernstein assigned a neutral rating largely due to valuation, while estimating the total upside potential of about 9% from current levels.
Earlier in May, Barclays raised its price recommendation on CL to $80 from $79. It reiterated an Equal Weight rating on the shares. The firm said it believes the company is placing greater emphasis on achieving a better balance between volume growth and pricing as it moves through 2026.
Colgate-Palmolive Company is a growth-focused business with operations across Oral Care, Personal Care, Home Care, and Pet Nutrition.
7. Target Corporation (NYSE:TGT)
Number of Hedge Fund Holders: 68
Guggenheim raised its price recommendation on Target Corporation (NYSE:TGT) to $145 from $140 on June 12. It reiterated a Buy rating on the shares. The update followed a meeting with management, including CEO Michael Fiddelke and CFO Jim Lee. Discussions focused on improving the execution of a go-to-market strategy built around “specialization at scale.” The analyst noted that Target’s stock has rallied 35% year to date, suggesting that “the easy money has been made.” Even so, continued operational progress could help attract longer-term investors.
Also on June 12, Goldman Sachs maintained a Neutral rating on Target. It kept its $127 price target after meeting with the company’s management team. According to the firm, Target is moving with greater urgency as it works to regain merchandising authority. The analyst said management appears to have a clearer strategic direction than it did previously. Goldman also highlighted management’s positive comments on inventory levels at the end of the first quarter. The company indicated that stronger sales trends are giving it the flexibility to chase inventory as needed.
Target Corporation is a general merchandise retailer that sells products through its stores and digital channels. The company offers a mix of differentiated merchandise and everyday essentials to customers, referred to as guests, at discounted prices.
6. QUALCOMM Incorporated (NASDAQ:QCOM)
Number of Hedge Fund Holders: 71
Wells Fargo raised its price recommendation on QUALCOMM Incorporated (NASDAQ:QCOM) to $230 from $160 on June 12. It reiterated an Equal Weight rating on the shares ahead of the company’s Investor Day. The firm said its bull-case scenario is worth more than $2.50 per share for every 1GW deployed, reflecting optimism around Qualcomm’s growth opportunities as investors look ahead to the event.
Earlier, on June 5, JPMorgan raised its price goal on Qualcomm to $265 from $160. It maintained a Neutral rating on the stock ahead of the company’s June 24 investor day. The firm expects Qualcomm to outline data center revenue targets of more than $3B in fiscal 2027 and $35B in fiscal 2031. JPMorgan also placed the shares on “Positive Catalyst Watch,” citing expectations that the targets presented at the investor day could exceed investor expectations. Even so, the firm maintained its Neutral rating, saying it wants to see evidence that Qualcomm can execute on these opportunities in what remains an increasingly competitive market.
QUALCOMM Incorporated develops and commercializes foundational technologies for the wireless industry. Its portfolio includes technologies supporting third-generation (3G), fourth-generation (4G), and fifth-generation (5G) wireless connectivity, as well as high-performance and low-power computing, including on-device artificial intelligence.
5. PepsiCo, Inc. (NASDAQ:PEP)
Number of Hedge Fund Holders: 72
On June 12, TD Cowen lowered its price recommendation on PepsiCo, Inc. (NASDAQ:PEP) to $150 from $165. It reiterated a Hold rating on the shares. The firm reduced its forecast for second-quarter organic growth to below consensus expectations, citing weak retail trends in the U.S. TD Cowen also lowered its fiscal 2027 earnings-per-share growth estimate to 5%, pointing to the timing of commodity cost inflation as a key factor.
On the same day, Piper Sandler analyst Michael Lavery lowered his price goal on PepsiCo to $178 from $181. He maintained an Overweight rating on the stock. The firm said it remains positive on PepsiCo’s portfolio of brands and its ability to return to sustainable growth. At the same time, Piper acknowledged that the company’s recovery path may not be smooth and that cost pressures are increasing. In the near term, the firm sees slower-than-expected distribution momentum in PepsiCo’s salty snacks business. Even so, it expects conditions to improve as new product innovations reach the market and delayed shelf resets are completed.
PepsiCo, Inc. manufactures, markets, distributes, and sells a wide range of beverages and convenient foods worldwide.
4. Honeywell International Inc. (NASDAQ:HON)
Number of Hedge Fund Holders: 75
On June 11, Reuters reported that Honeywell International Inc. (NASDAQ:HON) is targeting acquisitions valued between $2 billion and $4 billion and sees significant opportunities for deals within its industrial automation business.
“There is a ton of opportunity for M&A,” Peter Lau, president of Honeywell’s Industrial Automation unit, said during the company’s investor day in New York. He added that the business operates in a market worth roughly $35 billion. At the broader company level, Honeywell indicated that it plans to focus on bolt-on acquisitions within its preferred $2 billion to $4 billion range. This marks a narrower focus compared with its previous preferred deal size range of $1 billion to $7 billion.
Over the past several years, Honeywell has spent about $14 billion on roughly 10 acquisitions, primarily concentrating on bolt-on deals valued between $1 billion and $2 billion. The company has also combined those acquisitions with divestitures and planned spinoffs as part of an effort to simplify its business structure.
When asked whether larger acquisitions remain an option, Chief Executive Vimal Kapur told investors that, while circumstances can change, the company does not currently “see any necessity to go away from our fundamental strategy.”
Honeywell International Inc. is an integrated operating company serving a wide range of industries and geographic markets. Its portfolio is supported by the Honeywell Accelerator operating system and the Honeywell Forge platform.
3. The Procter & Gamble Company (NYSE:PG)
Number of Hedge Fund Holders: 78
On June 12, Bernstein initiated coverage of The Procter & Gamble Company with a Market Perform rating. It set a $156 price target on the stock. The firm said the company continues to face pressure from private-label products in “more commoditized categories” such as bathroom tissue, as well as from smaller competitors in the disposable diaper market. According to the analyst, these challenges are unlikely to disappear anytime soon. Bernstein also noted that its earnings growth estimates for Procter & Gamble are below broader market expectations.
During the company’s fiscal Q3 2026 earnings call, Chief Financial Officer Andre Schulten said Procter still expected organic sales growth of up to 4% for the fiscal year. He noted that fourth-quarter organic sales growth was expected to come in slightly below the level reported in the third quarter.
Schulten also said the company’s guidance called for core EPS growth of up to 4% year over year. This represents an earnings range of $6.83 to $7.09 per share. He added that Procter & Gamble now expects an after-tax headwind of about $150 million for the fiscal year. The impact is tied to commodity cost inflation, feedstock exposure, and logistics disruptions related to the conflict in the Middle East. Given those pressures, Schulten indicated that full-year EPS is now expected to fall toward the lower end of the company’s guidance range.
The Procter & Gamble Company manufactures and sells branded consumer packaged goods around the world. Its operations are organized across five segments: Beauty, Grooming, Health Care, Fabric & Home Care, and Baby, Feminine & Family Care.
2. Cisco Systems, Inc. (NASDAQ:CSCO)
Number of Hedge Fund Holders: 97
On June 12, Morgan Stanley raised its price recommendation on Cisco Systems, Inc. (NASDAQ:CSCO) to $130 from $120. It reiterated an Overweight rating on the shares. The firm said that growing inference workloads and increasing CPU intensity are driving a new wave of front-end infrastructure upgrades. Against that backdrop, Morgan Stanley views Cisco and Arista Networks (ANET) as its preferred ways to benefit from what it considers “an underappreciated front-end networking refresh cycle.”
Earlier, on June 8, BofA raised its price goal on Cisco to $150 from $135. It kept a Buy rating on the stock. The firm also increased price targets for Arista Networks and Extreme Networks (EXTR) following a series of networking-focused sessions held during its Global Technology Conference in San Francisco.
Cisco Systems, Inc. develops and sells a broad range of technologies that support the internet. The company is integrating its product portfolio across networking, security, collaboration, applications, and cloud services.
1. Oracle Corporation (NYSE:ORCL)
Number of Hedge Fund Holders: 115
On June 11, Scotiabank lowered its price recommendation on Oracle Corporation (NYSE:ORCL) to $241 from $290. It reiterated an Outperform rating on the shares. The firm said it continues to like Oracle’s “rock solid core software business” and believes the stock’s risk-reward profile remains tilted to the upside.
Also on June 11, RBC Capital maintained a Sector Perform rating on Oracle with a $190 price target following what it described as mixed fourth-quarter results. The company reported total revenue that came in above estimates, while Cloud revenue fell short of consensus expectations. Oracle Cloud Infrastructure (OCI) revenue grew 93% year over year, matching consensus forecasts. Management also noted that the Bring Your Own Hardware (BYOH) portion of Oracle’s large AI contracts has now reached $75B. According to RBC Capital, this should help reduce Oracle’s financing requirements.
Oracle Corporation provides integrated application suites along with secure, autonomous infrastructure through Oracle Cloud. The company operates across three business segments: cloud and license, hardware, and services.
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