In this article, we discuss 12 highest yielding Dow Jones dividend stocks. You can skip our detailed analysis of dividend stocks and their performance in the past, and go directly to read 5 Highest Yielding Dow Jones Dividend Stocks.
The Dow Jones Industrial Average, commonly referred to as the Dow, is one of the most widely recognized and influential stock market indices in the world. The index tracks the performance of 30 publicly traded companies listed on U.S. stock exchanges, representing a diverse range of industries. Since the start of 2023, the index has delivered a 5.88% return to shareholders, while its 12-month returns came in at 10.2%, as of the close of July 19.
Last year brought considerable turbulence to the overall stock market as the S&P 500 declined by over 18% and recorded its worst year since the Financial Crisis of 2008. The tech-heavy NASDAQ also shed over 33% of its value in 2022, underperforming DJIA, which only fell by 8% during the year. History shows that the Dow has outperformed NASDAQ on certain occasions. According to a report by Barron’s, in 1978, 1980, and 1992, the Dow outperformed the Nasdaq by a margin of at least seven percentage points. However, the most significant period of Dow dominance occurred during the dot-com bubble’s burst, with a total of 12 instances from 1999 to 2002.
Also read: 10 Dow Stocks Billionaires Are Loading Up On
Historically, the Dow has consistently shown better performance compared to the broader market as well. In our article titled Best Dow Jones Dividend Stocks To Buy, we reported data by S&P Global, which revealed that over the past 30 years until June 2021, the S&P 500 provided a return of 10.6%, while the DJIA achieved a slightly higher return of 11.16%. One of the main reasons for this outperformance is that the industry-leading companies in the Dow offer stable dividends and have stable yields.
Investing in high-yielding Dow Jones stocks can be an attractive strategy for investors seeking a steady income stream and potentially higher returns. When considering yields in dividend investment, investors often follow the ‘Dogs of the Dow’ strategy, which focuses on selecting ten stocks from the Dow with the highest dividend yields. Wall Street Journal reported that the investment strategy outperformed the DJIA in 2022 for the first time since 2018. This occurred as investors sought safe havens during the unpredictable fluctuations in the markets. Some of the best dividend stocks in the Dow are Verizon Communications Inc. (NYSE:VZ), Walgreens Boots Alliance Inc. (NASDAQ:WBA), and 3M Company (NYSE:MMM) among others that are mentioned below.
Our Methodology:
For this article, we examined the companies within the Dow Jones index and identified 12 stocks with the highest dividend yields as of July 19. It’s worth noting that the majority of companies in the Dow Jones are dividend payers. We also measured hedge fund sentiment around each stock according to Insider Monkey’s database of 943 funds as of Q1 2023. The stocks are ranked in ascending order of their dividend yields, as recorded on July 19.
12. Merck & Co., Inc. (NYSE:MRK)
Dividend Yield as of July 19: 2.76%
Merck & Co., Inc. (NYSE:MRK) is one of the largest pharmaceutical companies in the world. The company is widely known for its research, development, manufacturing, and marketing of a wide range of medicines and vaccines.
On May 23, Merck & Co., Inc. (NYSE:MRK) declared a quarterly dividend of $0.73, which was in line with its previous dividend. The company has been growing its dividends consistently for the past 12 years, which makes it one of the best dividend stocks on our list alongside Verizon Communications Inc. (NYSE:VZ), Walgreens Boots Alliance Inc. (NASDAQ:WBA), and 3M Company (NYSE:MMM). The stock has a dividend yield of 2.76%, as of July 19.
At the end of Q1 2023, 75 hedge funds in Insider Monkey’s database owned stakes in Merck & Co., Inc. (NYSE:MRK), compared with 77 in the previous quarter. These stakes are collectively worth over $3.7 billion. With over 2.8 million shares, AQR Capital Management was the company’s leading stakeholder in Q1.
11. The Goldman Sachs Group, Inc. (NYSE:GS)
Dividend Yield as of July 19: 2.96%
The Goldman Sachs Group, Inc. (NYSE:GS) is an American multinational investment bank and financial services company. It offers a wide range of services to corporations, financial institutions, governments, and individuals. In the second quarter of 2023, the company reported revenue of $10.9 billion and its net earnings for the quarter amounted to $1.22 billion. During the quarter, it returned $864 million to shareholders through dividends, which makes it one of the best dividend stocks on our list.
On July 19, The Goldman Sachs Group, Inc. (NYSE:GS) declared a 10% hike in its quarterly dividend to $2.75 per share. The stock has a dividend yield of 2.96%.
At the end of Q1 2023, 69 hedge funds in Insider Monkey’s database reported having stakes in The Goldman Sachs Group, Inc. (NYSE:GS), worth collectively over $3.1 billion. Ken Griffin, Boykin Curry, and Edgar Wachenheim were some of the company’s leading stakeholders in Q1.
10. Johnson & Johnson (NYSE:JNJ)
Dividend Yield as of July 19: 2.99%
Johnson & Johnson (NYSE:JNJ) is a multinational conglomerate operating in the healthcare sector. In June, the company’s Janssen unit received conditional authorization from Health Canada for its prostate cancer tablets called Akeega. Patients can receive Akeega even if they are asymptomatic or mildly symptomatic, and chemotherapy is not clinically indicated for them as per Health Canada’s label for the drug. This authorization opens up a new treatment option for eligible patients with this particular type of prostate cancer in Canada.
On April 18, Johnson & Johnson (NYSE:JNJ) declared a quarterly dividend of $1.19 per share, having raised it by 5.3% from its previous dividend. The company is one of the best dividend stocks on our list with 62 years of consistent dividend growth under its belt. The company’s shares boast a yield of 2.99%, as recorded on July 19.
In Q1 2023, the number of hedge funds owning stakes in Johnson & Johnson (NYSE:JNJ) increased to 86, from 84 in the previous quarter, according to Insider Monkey’s database. The combined value of these stakes now amounts to more than $4.5 billion.
9. Cisco Systems, Inc. (NASDAQ:CSCO)
Dividend Yield as of July 19: 3.04%
Cisco Systems, Inc. (NASDAQ:CSCO) is a California-based tech company that specializes in designing, manufacturing, and selling networking hardware, software, and telecommunications equipment. It is one of the leading providers of network solutions.
Cisco Systems, Inc. (NASDAQ:CSCO) reported strong earnings in its fiscal Q3 2023 with consolidated revenues of $14.57 billion. The revenue showed a 13.5% growth from the same period last year. Its operating cash flow for the quarter came in at $5.2 billion, up 43% from the prior-year period.
Cisco Systems, Inc. (NASDAQ:CSCO), one of the best dividend stocks on our list, currently pays a quarterly dividend of $0.39 per share. The company has raised its dividends consistently for 12 years straight. During its most recent quarter, it distributed $1.6 billion worth of dividends among shareholders.
Out of the 943 hedge funds tracked by Insider Monkey at the end of Q1 2023, 61 funds owned stakes in Cisco Systems, Inc. (NASDAQ:CSCO), with a total value of over $2.5 billion.
8. The Coca-Cola Company (NYSE:KO)
Dividend Yield as of July 19: 3.04%
The Coca-Cola Company (NYSE:KO) is next on our list of the best dividend stocks in the Dow Jones. The company holds one of the longest dividend growth track records of 61 years. It currently pays a quarterly dividend of $0.46 per share for a dividend yield of 3.04%, as of July 19.
According to Insider Monkey’s database of Q1 2023, 61 hedge funds were bullish on The Coca-Cola Company (NYSE:KO), owning stakes with a collective value of over $24.8 billion. Warren Buffett’s Berkshire Hathaway was the company’s leading stakeholder with 400 million shares at the end of Q1 2023.
7. Amgen Inc. (NASDAQ:AMGN)
Dividend Yield as of July 19: 3.66%
Amgen Inc. (NASDAQ:AMGN) is an American multinational biopharmaceutical company that focuses on the development, manufacturing, and commercialization of innovative human therapeutics. It is one of the best dividend stocks on our list as it has raised its dividends every year since 2011. It currently offers a quarterly dividend of $2.13 per share and has a dividend yield of 3.66%, as of July 19.
Amgen Inc. (NASDAQ:AMGN) registered $6.1 billion in revenues in the first quarter of 2023, which fell by 2.2% from the same period last year. However, the company’s cash position remained strong as it generated $1.1 billion in operating cash flow. It also paid $1 billion to shareholders through dividends.
At the end of Q1 2023, 57 hedge funds in Insider Monkey’s database disclosed owning stakes in Amgen Inc. (NASDAQ:AMGN), valued at a total of more than $1.68 billion.
6. Chevron Corporation (NYSE:CVX)
Dividend Yield as of July 19: 3.93%
Chevron Corporation (NYSE:CVX) ranks sixth on our list of the best dividend stocks. The multinational energy company has always remained committed to its shareholder obligation. In the first quarter of 2023, it returned $6.6 billion to shareholders in dividends and share repurchases.
In January 2023, Chevron Corporation (NYSE:CVX) raised its dividend for the 36th consecutive year. The company pays a per-share dividend of $1.15 every quarter and has a dividend yield of 3.93%, recorded on July 19. In addition to CVX, other high yield dividend stocks in the DJIA are Verizon Communications Inc. (NYSE:VZ), Walgreens Boots Alliance Inc. (NASDAQ:WBA), and 3M Company (NYSE:MMM).
According to Insider Monkey’s Q1 2023 database, 64 funds held stakes in Chevron Corporation (NYSE:CVX), an increase from 57 funds in the previous quarter. The total value of these stakes is $23.6 billion. Among these hedge funds, Warren Buffett’s Berkshire Hathaway was the company’s leading stakeholder, owning a stake worth over $21.6 billion.
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Disclosure. None. 12 Highest Yielding Dow Jones Dividend Stocks is originally published on Insider Monkey.
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