In this article, we will take a look at some of the safest dividend stocks to buy.
Dividend-paying stocks can provide stability during market swings, even when overall equity prices are rising. Many investors prefer them as a source of steady income and a partial hedge against volatility. However, not all dividend stocks carry the same appeal. Goldman Sachs has shown a preference for dividend growth stocks, which are companies with a track record of consistently raising their payouts.
A report by RMB Capital noted that over time, companies that initiate dividends and steadily increase them have delivered stronger returns than the broader market. They have also outperformed companies that either reduce dividends or do not pay them at all. According to the findings, Dividend Growers and Initiators returned 9.62%, Dividend Payers returned 8.78%, while companies with no change in dividend policy generated 6.88%.
Shareholders of established companies often prefer receiving dividends and may push firms to distribute them. A cash dividend signals that a company’s profits are genuine rather than just accounting adjustments. Dividends also act as a cushion in declining markets, giving investors cash they can either use directly or reinvest in stocks at lower prices. This tendency increases demand for dividend-paying stocks during downturns and helps support market stability.
Given this, we will take a look at some of the best dividend stocks.
Photo by Annie Spratt on Unsplash
Our Methodology:
For this article, we used a Finviz screener to identify dividend companies with at least 10 consecutive years of dividend growth. From that list, we picked stocks with dividend yields above 4%, as of September 20. The stocks are ranked according to their dividend yields.
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. Kimberly-Clark Corporation (NASDAQ:KMB)
Dividend Yield as of September 20: 4.04%
Kimberly-Clark Corporation (NASDAQ:KMB) is a multinational company known for its personal care and tissue products. Its leading brands include Huggies diapers, Kotex feminine care items, and Kleenex tissues, serving both household and commercial markets worldwide.
In recent years, Kimberly-Clark Corporation (NASDAQ:KMB) has sharpened its focus on two main areas: boosting product innovation and enhancing operational efficiency. Developing new products plays a central role in maintaining customer loyalty and capturing greater market share. Alongside this, the company has introduced a multi-year Transformation Initiative aimed at lowering costs and building a more flexible operating structure. These steps are particularly important as performance depends on how effectively it grows both premium and value product categories while navigating complex supply chains and external challenges such as tariffs and rising costs.
Kimberly-Clark Corporation (NASDAQ:KMB) is also popular among investors in terms of its dividends. The company has raised its payouts for 53 years in a row and currently pays a quarterly dividend of $1.26 per share. With a dividend yield of 4.04%, as of September 20, KMB is one of the best dividend stocks to consider.
9. The Clorox Company (NYSE:CLX)
Dividend Yield as of September 20: 4.08%
The Clorox Company (NYSE:CLX) is a consumer goods company recognized for its wide range of products, including household cleaners, disinfecting wipes, bleach, trash bags, grilling items, cat litter, and food condiments. Around 80% of its sales come from brands that rank first or second in their categories, based on FY24 results. Strong brand recognition and customer loyalty support its pricing power, particularly in the competitive US retail and grocery markets.
The Clorox Company (NYSE:CLX) is currently focused on strengthening brand value, keeping its supply chain resilient, driving product innovation, and advancing digital transformation. Protecting trademarks, defending market share, and adjusting to changing consumer preferences remain essential priorities. The company is also making significant technology investments, such as implementing a new enterprise resource planning (ERP) system, to improve efficiency and enhance data-driven supply chain management. Sustainability efforts, including reducing waste and cutting emissions, are also central to its long-term strategy.
On September 17, The Clorox Company (NYSE:CLX) declared a quarterly dividend of $$1.24 per share, which was in line with its previous dividend. Overall, the company has been rewarding shareholders with growing dividends for the past 22 years. The stock supports a dividend yield of 4.08%, as of September 20.
