In this article, we will take a look at some of the best dogs of the Dow.
Investors who focus on dividends are often attracted to stocks offering high yields and build their portfolios accordingly. One popular method is the Dogs of the Dow (DOD) strategy, which involves picking the 10 highest-yielding stocks from the Dow Jones Industrial Average (DJIA) each year. The idea behind this strategy is that these stocks are temporarily undervalued or overlooked by the market. By investing in them, investors aim to capture both dividend income and potential price gains once these stocks rebound.
This strategy has shown strong results over time. Michael O’Higgins found that over a 26-year span, a theoretical portfolio based on high-yield Dow stocks delivered an annual return of 17.9%, outperforming the Dow’s own return of 13% during the same period.
Still, experts urge investors to use this strategy with caution. Kevin Simpson, founder and chief investment officer at Capital Wealth Planning, shared his thoughts on this approach during a CNBC interview and made the following comment:
“The idea here is that just because they’re ‘Dogs of the Dow’ — some of them really are dogs — and you have to be careful and selective as a stock picker.”
Given this, we will take a look at some of the best dogs of the Dow to invest in.
Our Methodology
We began with a pool of 30 stocks from the Dow Jones Industrial Average (DJIA) and identified dividend-paying stocks from this selection. As a majority of the stocks in the index offer dividends, we specifically picked the 11 stocks with the highest dividend yields as of July 26. The stocks are ranked in ascending order of their dividend yields. We also considered hedge fund sentiment around each stock using Insider Monkey’s data for 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).
11. NIKE, Inc. (NYSE:NKE)
Dividend Yield as of July 26: 2.10%
NIKE, Inc. (NYSE:NKE) is among the best dogs of the Dow to invest in. The world’s biggest footwear company stated on Thursday that existing tariffs might push its costs up by around $1 billion. This announcement followed the release of its fiscal fourth-quarter 2025 results, which managed to surpass estimates.
In fiscal Q4 2025, NIKE, Inc. (NYSE:NKE) reported revenue of $11.1 billion, which fell by nearly 12% from the same period last year. However, the revenue surpassed analysts’ estimates by $373.5 million. The fourth quarter marked the period with the most significant financial impact from the company’s “Win Now” initiatives, and management expects these pressures to ease going forward. Leadership expressed confidence in the firm’s ability to steer through the current unpredictable environment by maintaining focus on controllable factors and effectively carrying out the “Win Now” strategy.
NIKE, Inc. (NYSE:NKE)’s cash position also remained stable. The company ended the year with cash and equivalents and short-term investments of $9.2 billion. During the year, it returned $2.3 billion to shareholders through dividends. The company offers a quarterly dividend of $0.40 per share and has a dividend yield of 2.10%, as of July 26. It has raised its payouts for 23 consecutive years.
10. Cisco Systems, Inc. (NASDAQ:CSCO)
Dividend Yield as of July 26: 2.39%
Cisco Systems, Inc. (NASDAQ:CSCO) is widely recognized for its networking, cybersecurity, software, and cloud computing solutions. It produces routers and switches that use the Internet Protocol to move data across networks.
Artificial intelligence has become a major growth area for Cisco Systems, Inc. (NASDAQ:CSCO), with AI-related revenue exceeding $1 billion in 2024. Cisco aims to at least double that figure in 2025. A key factor in this expansion has been its $28 billion acquisition of Splunk, completed last year, which is intended to strengthen customers’ capabilities in networking, security, and AI.
Cisco Systems, Inc. (NASDAQ:CSCO) reported strong earnings in its fiscal Q3 2025. The company’s revenue came in at $14.15 billion, which showed an 11.4% growth from the same period last year. The revenue also beat analysts’ estimates by $91.4 million. Orders for AI infrastructure from webscale clients surpassed $600 million, allowing the company to hit its $1 billion goal a quarter ahead of schedule. This strong performance in AI is driven by the strength of its secure networking solutions, strong global alliances, and the value it consistently delivers to customers.
Cisco Systems, Inc. (NASDAQ:CSCO) generated an operating cash flow of $4.1 billion during the quarter, and it returned $1.6 billion to investors through dividends. In addition, it has raised its payouts for 18 consecutive years. Currently, it offers a quarterly dividend of $0.41 per share and has a dividend yield of 2.39%, as of July 26.
9. The Home Depot, Inc. (NYSE:HD)
Dividend Yield as of July 26: 2.45%
The Home Depot, Inc. (NYSE:HD) is among the best dogs of the Dow to invest in. The company is facing challenges expanding its business amid a tough economic climate marked by elevated interest rates and growing caution among consumers when it comes to major purchases.
Still, several positive trends could work in the company’s favor. Housing inventory in the US remains tight compared to demand, and the average home is aging. In addition, homeowners have access to trillions of dollars in home equity that could be used for remodeling and improvements. As economic conditions stabilize or improve, Home Depot is likely to benefit from stronger demand.
In the first quarter of 2025, The Home Depot, Inc. (NYSE:HD) reported revenue of $39.86 billion, up 9.44% from the same period last year. Comparable sales declined by 0.3%, while US comparable sales saw a slight increase of 0.2%. The company noted that fluctuations in foreign exchange rates had a negative effect, reducing overall comparable sales by about 70 basis points.
The Home Depot, Inc. (NYSE:HD) reported an operating cash flow of $4.3 billion and ended the quarter with $1.4 billion in cash and cash equivalents. The company is a reliable dividend payer with 16 consecutive years of dividend growth under its belt. Currently, it offers a quarterly dividend of $2.30 per share for a dividend yield of 2.45%, as of July 26.
8. The Procter & Gamble Company (NYSE:PG)
Dividend Yield as of July 26: 2.67%
The Procter & Gamble Company (NYSE:PG) owns several leading consumer brands like Pampers and Tide— products that are considered essentials for many households. While there’s always a possibility that consumers could opt for cheaper, generic alternatives, recent sales figures don’t indicate any major shift in buying behavior that would pose a serious threat to the business.
The Procter & Gamble Company (NYSE:PG) is considered one of the most reliable dividend stocks in the market. Its stability comes from a wide range of top-tier brands in areas like beauty, health, grooming, home care, and family care. Thanks to strong customer loyalty and an efficient global supply chain, the company regularly posts profit margins that outperform many competitors.
The Procter & Gamble Company (NYSE:PG)’s long-standing financial strength is further proven by its impressive 69 consecutive years of dividend increases, which is one of the longest growth streaks among publicly traded companies. On July 8, the company declared a quarterly dividend of $1.0568 per share, in line with its previous dividend. With a dividend yield of 2.67% as of July 26, PG is among the best dogs of the Dow.
7. The Coca-Cola Company (NYSE:KO)
Dividend Yield as of July 26: 2.95%
The Coca-Cola Company (NYSE:KO) is one of the best dogs of the Dow to invest in. The stock has surged by nearly 12% since the start of 2025, outperforming the broader market. Investors have shown strong interest in the stock this year for a number of reasons. It’s often seen as a safe choice during market downturns because of its stability, making it a popular pick when uncertainty rises.
More recently, confidence in The Coca-Cola Company (NYSE:KO) has been boosted by its strong position against potential tariff impacts. In addition, the company reported strong earnings in the second quarter of 2025. Its revenue came in at $12.6 billion, up 1% from the same period last year. The revenue beat analysts’ estimates by $42 million. Operating income rose by 63%, while on a comparable currency-neutral basis (non-GAAP), it saw a 15% increase.
The Coca-Cola Company (NYSE:KO) also remains investors’ favorite because the company has been growing its payouts for 63 consecutive years. The company pays a quarterly dividend of $0.51 per share and has a dividend yield of 2.95%, as of July 26.
6. Johnson & Johnson (NYSE:JNJ)
Dividend Yield as of July 26: 3.09%
Johnson & Johnson (NYSE:JNJ) has a sizable and broadly positioned operation, with strong representation in both the medical devices and pharmaceutical sectors. Its leading status in the industry is also supported by its robust efforts in research and development, as well as effective marketing capabilities.
In the second quarter of 2025, Johnson & Johnson (NYSE:JNJ) reported revenue of $23.7 billion, which showed a 5.77% growth from the same period last year. The company raised its full-year sales outlook by $2 billion to reflect a 5.4% increase, thanks to solid operational performance and positive foreign exchange impacts. It also boosted its earnings per share (EPS) forecast by $0.25, bringing it to $10.85. Meanwhile, adjusted operational EPS was revised to $10.68 at the midpoint.
In its earnings report, Johnson & Johnson (NYSE:JNJ) indicated that its portfolio and pipeline have set the stage for accelerated growth in the latter half of the year. It expects significant approvals and regulatory submissions in key areas such as lung and bladder cancer, major depressive disorder, psoriasis, surgery, and cardiovascular health— advancements that are likely to enhance and extend lives in meaningful ways.
Johnson & Johnson (NYSE:JNJ) is favored because of its strong dividend policy. The company has been growing its dividends for 63 consecutive years and currently pays a quarterly dividend of $1.30 per share. With a dividend yield of 3.09%, as of July 26, JNJ is among the best dogs of the Dow to invest in.
5. Amgen Inc. (NASDAQ:AMGN)
Dividend Yield as of July 26: 3.11%
Amgen Inc. (NASDAQ:AMGN) is on the hunt for its next breakthrough drug— a common pursuit among pharmaceutical companies looking to stay ahead of rivals, especially as biosimilar competition grows. The company boasts a robust pipeline, with dozens of ongoing programs that could result in future drug approvals and expanded uses for existing treatments. Thanks to its strong track record of innovation, Amgen has performed well for years, and that momentum is expected to continue.
Amgen Inc. (NASDAQ:AMGN) also reported strong earnings in the first quarter of 2025. The company posted revenue of $8.15 billion, marking a 9.4% increase year-over-year. It benefited from strong global demand for its products. Management voiced optimism about its long-term growth prospects, supported by the success of recent product launches and encouraging Phase 3 trial outcomes for multiple treatments.
Amgen Inc. (NASDAQ:AMGN)’s cash flow makes it one of the most reliable dividend stocks. The company generated $1.0 billion in free cash flow during the quarter, doubling the figure from the same period a year earlier. Operating cash flow rose to $1.4 billion from $0.7 billion in the prior year. The company also returned $1.3 billion to shareholders in the form of dividends.
Amgen Inc. (NASDAQ:AMGN) offers a quarterly dividend of $2.38 per share and has a dividend yield of 3.11%, as of July 26. The company has raised its dividends every year since 2011, which places it among the best dogs of the Dow.
4. UnitedHealth Group Incorporated (NYSE:UNH)
Dividend Yield as of July 26: 3.15%
UnitedHealth Group Incorporated (NYSE:UNH) is one of the best dogs of the Dow to consider. The stock has dropped over 44% so far this year after reporting weaker-than-expected earnings in the first quarter. The company first reduced its full-year outlook and later chose to withdraw it entirely.
Even with the underwhelming Q1 performance, UnitedHealth Group Incorporated (NYSE:UNH) still posted a 9.8% year-over-year increase in revenue, reaching $109.6 billion. It earned a profit of around $6.3 billion during the quarter and maintained a solid financial position, holding close to $34.3 billion in cash and cash equivalents, along with a debt level that remains manageable. The company has added 780,000 new members so far this year. Meanwhile, Optum Health still expects to provide value-based care to an additional 650,000 patients in 2025.
In addition, UnitedHealth Group Incorporated (NYSE:UNH) generated $5.5 billion in operating cash flow during the quarter and returned $5 billion to investors through dividends and share repurchases. The company has been rewarding shareholders with growing dividends since 2011 and currently offers a quarterly dividend of $2.21 per share. The stock supports a dividend yield of 3.15%, as of July 26.
3. Merck & Co., Inc. (NYSE:MRK)
Dividend Yield as of July 26: 3.82%
Merck & Co., Inc. (NYSE:MRK) has faced stock pressure due to its reliance on Keytruda but is diversifying. On July 9, Merck announced it would acquire UK biotech Verona Pharma for $10 billion, adding Ohtuvayre, a promising COPD treatment approved last year, to its portfolio. Ohtuvayre has had a strong launch and is being studied for more uses. Some analysts predict its sales could reach $4 billion, potentially making it another blockbuster for Merck.
In its first quarter earnings, Merck & Co., Inc. (NYSE:MRK) highlighted that it began the year with strong progress, driven by growing contributions from its recently commercialized medicines and vaccines, along with ongoing advancements in its pipeline. It is focused and determined to fully capitalize on near-term opportunities while swiftly advancing the next wave of innovations that will improve patient outcomes and create long-term value for all stakeholders.
Merck & Co., Inc. (NYSE:MRK) is also popular because of its dividend growth history, which spans 16 consecutive years. Currently, the company offers a quarterly dividend of $0.81 per share and has a dividend yield of 3.82%, as of July 26.
2. Chevron Corporation (NYSE:CVX)
Dividend Yield as of July 26: 4.42%
Chevron Corporation (NYSE:CVX) is among the best dogs of the Dow to invest in. It is currently facing some company-specific challenges, including a complicated merger and operations in politically unstable regions. However, these issues are unlikely to affect its long-term prospects. Income-focused investors can generally feel confident investing in Chevron.
Chevron Corporation (NYSE:CVX)’s integrated business model, covering everything from exploration and production to refining and chemicals, offers operational flexibility and acts as a natural hedge against fluctuations in energy prices, enhancing its resilience through market cycles. Unlike many competitors who chase volume growth, Chevron takes a disciplined approach, investing only in its highest-return projects, avoiding overexpansion during booms, and making strategic, value-adding acquisitions.
This strategy, along with a strong balance sheet, establishes Chevron Corporation (NYSE:CVX) as a leading operator with the financial strength to endure downturns and seize growth opportunities. The company has been growing its dividends for 38 consecutive years and currently offers a quarterly dividend of $1.71 per share. As of July 26, the stock has a dividend yield of 4.42%.
1. Verizon Communications Inc. (NYSE:VZ)
Dividend Yield as of July 26: 6.29%
A high dividend yield can sometimes signal trouble, but that’s not the case with Verizon Communications Inc. (NYSE:VZ), despite its 6.3% yield. The company’s latest quarterly performance suggests its dividend is well-covered.
In the second quarter, Verizon Communications Inc. (NYSE:VZ) posted solid results with revenue up 5.3% to $34.5 billion and adjusted earnings growing 6.1% to $1.22 per share. Wireless service revenue rose to $20.9 billion, leading the industry, while broadband and business wireless segments also expanded. The company added more than 300,000 new mobility and broadband customers, with Fios gaining ground. Recent efforts to improve customer loyalty and attract new users played a key role in this growth.
Over the first half of the year, Verizon Communications Inc. (NYSE:VZ) generated $16.8 billion in operating cash flow, $200 million more than the same time last year. After spending $8 billion to support its fiber and 5G infrastructure, it still had $8.8 billion in free cash flow— enough to easily cover $5.7 billion in dividends and leave $3.1 billion in excess cash.
Verizon Communications Inc. (NYSE:VZ) has raised its dividends for 18 consecutive years, which makes it a reliable choice among income investors. The company’s quarterly dividend comes in at $0.6775 per share.
While we acknowledge the potential of VZ 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 VZ and that has 100x upside potential, check out our report about this cheapest AI stock.
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