In this article, we will take a look at the most profitable dividend stocks to invest in.
In a period marked by market volatility, ongoing policy and geopolitical uncertainty, many investors have been shifting toward fixed-income assets and away from equities in search of stability and reliable income. Even so, this uncertain environment also highlights the appeal of dividend-focused ETFs, which aim to deliver income through dividend-paying stocks while maintaining diversification.
Dividends have played a crucial role in overall equity returns for decades, contributing about one-third of the S&P 500’s total return since 1926. This reliability continues to attract investors who value steady cash flow during uncertain market conditions.
Dan Caps, investment partner at Evelyn Partners, noted that investing in higher-dividend-paying stocks is a long-standing approach that draws a broad range of investors, including retirees, charities, and trusts. He added that the strategy offers not just income but also a degree of predictability, helping to balance the ups and downs that often come with investing in equities.
Our Methodology:
For this list, we screened for stable dividend companies that have strong dividend growth track records. From that group, we picked companies with a net profit margin exceeding 25%, which suggests sound financial health and excellent cost management. The stocks are ranked in ascending order of their net profit margin as of the trailing twelve-month period.
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).
13. Johnson & Johnson (NYSE:JNJ)
Net Profit Margin: 25.1%
Johnson & Johnson (NYSE:JNJ) is one of America’s most recognizable healthcare companies, with operations that now center on pharmaceuticals and medical devices. After spinning off its consumer health unit, which included familiar names like Tylenol, Neutrogena, and Listerine, into a separate company called Kenvue, the company narrowed its focus to pharmaceuticals and medical technology. These two areas now power the business, with 26 products or platforms each bringing in more than $1 billion a year, forming the bulk of its revenue and cash flow.
Johnson & Johnson (NYSE:JNJ) continues to bring in strong cash flows, much of which is poured back into research and development to keep growth on track. The rest goes toward shareholder returns. In 2024, J&J invested about $17 billion in R&D and paid $11.8 billion in dividends. The dividend is also its strength, which the company has already grown for 63 consecutive years. With a quarterly dividend of $1.30 per share, JNJ has a dividend yield of 2.77%, as of October 6.
In its pharmaceutical arm, J&J has its sights set on leading the oncology market, aiming for $50 billion in sales. Treatments like Darzalex and Carvykti are expected to drive that effort. The company’s $14.6 billion purchase of Intra-Cellular Therapies also added Caplyta, a growing antipsychotic drug, which it believes could eventually bring in $5 billion annually. On the medical technology front, innovation in robotic surgery and cardiovascular care remains central to its next phase of growth.
12. Merck & Co., Inc. (NYSE:MRK)
Net Profit Margin: 25.81%
An American multinational pharmaceutical company, Merck & Co., Inc. (NYSE:MRK) is one of the most profitable stocks that pay dividends, with a trailing twelve-month net profit margin of 25.8%. Finding new medicines is a complex process, and progress rarely follows a straight path. At the moment, some investors are worried that Merck’s existing patents could expire before the company introduces another major hit to take their place. The concern makes sense, given that a large part of the company’s revenue currently depends on one key product, the cancer drug Keytruda.
Still, this kind of situation isn’t out of the ordinary in the pharmaceutical world. Most drugmakers face similar cycles as older treatments lose exclusivity and new ones are developed. What sets Merck & Co., Inc. (NYSE:MRK) apart is its strong research foundation and considerable scale, which give it the flexibility to acquire smaller biotech firms when it needs to strengthen its drug pipeline. This steady approach has helped the company perform well over the long run and maintain a history of consistent dividend growth, even if the increases haven’t occurred every single year.
Merck & Co., Inc. (NYSE:MRK)’s dividend growth streak of 16 years is hard to neglect for income investors. The company’s quarterly dividend comes in at $0.81 per share, offering an attractive dividend yield of 3.65%, as of October 6.
11. Mid-America Apartment Communities, Inc. (NYSE:MAA)
Net Profit Margin: 26.57%
Mid-America Apartment Communities, Inc. (NYSE:MAA) is one of the country’s largest apartment owners, though it tends to fly under the radar unless you live in the southern United States. The real estate investment trust manages more than 104,000 units spread across major Sun Belt cities such as Atlanta and Dallas, as well as smaller, fast-growing markets like Charleston and Savannah. While it may not be as popular as landlords with properties in big coastal hubs, it remains a major player in its region.
Unlike many developers that have pulled back on new projects, Mid-America Apartment Communities, Inc. (NYSE:MAA) has been steadily expanding. The company has recently completed four new apartment communities, which are now in the process of leasing. These developments added over 1,400 units and required an investment of about $385.6 million. They are already close to being fully occupied, with stabilization expected before the year ends.
In addition, Mid-America Apartment Communities, Inc. (NYSE:MAA)’s dividend history offers it stability, which income investors are always looking for. The company has grown its dividends for 15 years in a row and offers a quarterly dividend of $1.515 per share. As of October 5, the stock has a dividend yield of 4.46%.
10. Canadian National Railway Company (NYSE:CNI)
Net Profit Margin: 26.62%
Canadian National Railway Company (NYSE:CNI) is one of the quiet forces behind North America’s economy. Each year, it moves over 300 million tons of cargo, ranging from raw materials to finished goods, across Canada and deep into the US. Its network spans nearly 20,000 miles of track, connecting both coasts of Canada with key hubs in the Midwest, running through Chicago and stretching all the way to New Orleans.
Canadian National Railway Company (NYSE:CNI) strength lies in a combination of reach, efficiency, and infrastructure that would be almost impossible for a new rival to replicate. Its tracks and terminals form a network that took decades to build, and its access to major ports gives it an edge few can match. Among its biggest advantages is its role as the primary rail operator for the Port of Prince Rupert in British Columbia, a gateway that continues to fuel growth in its intermodal business.
That kind of scale and positioning has made Canadian National Railway Company (NYSE:CNI) a steady generator of cash flow. It’s a company that not only invests heavily in its network but also rewards investors through regular dividend growth, supported by the kind of financial stability that has defined its history. The company’s dividend growth is one of its biggest strengths, spanning 29 years. Its quarterly dividend of C$0.8875 per share translates into a dividend yield of 2.66%, as of October 6.
9. QUALCOMM Incorporated (NASDAQ:QCOM)
Net Profit Margin: 26.75%
QUALCOMM Incorporated (NASDAQ:QCOM) continues to hold its position as a leader in smartphone chip technology, staying ahead of the curve with new processors that now include built-in AI capabilities. Its supply deal with Apple runs through March 2027, which should help sustain sales in the near term. The company also maintains a strong foothold in premium smartphones powered by Alphabet’s Android software. With signs of another smartphone upgrade cycle emerging, investors who have waited patiently may finally see better returns.
So far in fiscal 2025, which ended on June 29, smartphone chips have accounted for about 63% of QUALCOMM Incorporated (NASDAQ:QCOM)’s total revenue. However, the company is working to lessen its dependence on this segment. It’s placing more focus on its IoT and automotive businesses, both of which are seen as promising growth engines that could help offset any decline in Apple-related revenue.
QUALCOMM Incorporated (NASDAQ:QCOM)’s dividend growth streak of 21 consecutive years also makes it a prominent investment in the eyes of income investors. With a quarterly dividend of $0.89 per share, QCOM has a dividend yield of 2.11%.
8. Zoetis Inc. (NYSE:ZTS)
Net Profit Margin: 27.94%
Zoetis Inc. (NYSE:ZTS) offers a range of drugs and healthcare products for companion animals and livestock worldwide. The company keeps innovating with a portfolio that includes seven main product categories and about 300 product lines.
As younger generations show more interest in pets and the growing global population increases the need for animal proteins, the animal health market is set to expand. Zoetis Inc. (NYSE:ZTS)’s management predicts it will rise from $48 billion in 2023 to between $75 billion and $85 billion by 2033. Historically, the company has grown faster than the industry. Consumer priorities are shifting towards wellness and personalized medicine for pets. This trend drives growth in areas like nutrition, supplements, and therapies, which is promising for Zoetis’ leading pet business.
With 14 consecutive years of dividend growth, Zoetis Inc. (NYSE:ZTS) has always grabbed the attention of income investors. Currently, it offers a quarterly dividend of $0.50 per share for a dividend yield of 1.38%, as of October 6.
7. Moody’s Corporation (NYSE:MCO)
Net Profit Margin: 29.36%
Moody’s Corporation (NYSE:MCO) is a New York-based business and financial services company. The stock is delivering strong returns to shareholders, surging by over 21% in the past six months. The company mainly specializes in risk assessment and data analytics, and is widely known for its credit rating expertise. Its two main divisions, Moody’s Investors Service and Moody’s Analytics, help the company to manage risk on a broader level and make informed financial decisions.
Moody’s Corporation (NYSE:MCO)’s concentration on strategic priorities is giving it a push in the eyes of the analysts. The company expects to grow its recurring revenue, especially from the analytics business. Moreover, it plans to integrate more artificial intelligence and automation in its operations. These efforts are designed to ensure long-term growth, enhance client confidence, and help the company stay ahead as financial markets and regulatory standards continue to change.
Moody’s Corporation (NYSE:MCO)’s financials are also strong, which enables it to fulfill its operational obligations. Its cash flow is in place, due to which the company managed to grow its dividend payouts for 15 consecutive years. The company’s per-share quarterly dividend is $0.94, and as of October 6, it offers a dividend yield of 0.78%.
6. STAG Industrial, Inc. (NYSE:STAG)
Net Profit Margin: 29.78%
An American real estate investment trust company, STAG Industrial, Inc. (NYSE:STAG) has a portfolio that consists of single-tenant warehouses that play a major role in e-commerce and logistics. The rise of online shopping and a shift toward more domestic manufacturing since the pandemic have kept demand for such spaces strong, supporting high occupancy rates and allowing the company to steadily raise its rental income.
Over the years, STAG Industrial, Inc. (NYSE:STAG) has grown its dividend by continuously expanding its portfolio. Since going public more than a decade ago, it has added over 400 properties and now owns more than 590 buildings nationwide. The company holds an 11-year streak of consistent dividend payments and is popular because of its monthly payouts. Its dividend sits at $0.1242 per share for every month and has an attractive dividend yield of 4.09%.
STAG Industrial, Inc. (NYSE:STAG) expects that growth momentum to carry forward. In 2025 alone, Stag acquired roughly $682 million worth of new properties, adding 5.9 million square feet of leased space with an average lease term of six years.
5. Texas Instruments Incorporated (NASDAQ:TXN)
Net Profit Margin: 30.23%
Texas Instruments Incorporated (NASDAQ:TXN), widely recognized for its analog and embedded chips, plays a key role in powering a broad range of technologies — from factory automation systems and automobiles to medical devices and power infrastructure. After navigating a bumpy stretch in the semiconductor market, the Dallas-based company appears to be regaining steady ground this year, maintaining its trademark focus on long-term cash generation and reliable shareholder returns. The blend of improving fundamentals and consistent capital distributions continues to define its appeal for investors.
In its latest quarterly report, Texas Instruments Incorporated (NASDAQ:TXN) reaffirmed what it considers the company’s guiding principle. As CFO Rafael Lizardi explained, the goal remains to drive “long-term growth of free cash flow per share.” That mindset underpins the company’s major investments in 300-mm manufacturing, a move aimed at strengthening its long-term cost advantages. While these projects have kept capital spending high in the short term, they’re expected to enhance margins and expand the company’s ability to return more cash to shareholders over the coming years.
Speaking of the company’s shareholder return, Texas Instruments Incorporated (NASDAQ:TXN) gave good news to investors in September by announcing a 4.4% hike in its quarterly dividend. This took the company’s dividend growth streak to 22 years. It now pays a quarterly dividend of $1.42 per share for a dividend yield of 3.12%, as of October 5.
4. Southern Copper Corporation (NYSE:SCCO)
Net Profit Margin: 30.38%
Southern Copper Corporation (NYSE:SCCO) specializes in mining, smelting, and refining copper and various by-products such as zinc, molybdenum, and silver. Its main property is located in Peru and Mexico, two areas that are accompanied by giant ore deposits. The mines of the company – such as Tocipala and Cuzon in Peru, and La Karidad in Mexico- anchor their global status in the production of copper.
In recent years, Southern Copper Corporation (NYSE:SCCO) has focused on improving operating efficiency to expand its reserves, reduce costs, and offset commodity price swings. Major measures include advanced mining techniques, investment in Peru and Mexico in project development, and increasing emphasis on permanent practices. The ability to manage regulatory risks and maintain community relations is also important for its continuous success.
Southern Copper Corporation (NYSE:SCCO)’s dividend policy makes it an appealing option for investors looking for regular income. The company has raised its payouts for 28 years in a row, and now offers a quarterly dividend of $0.80 per share. As of October 6, the stock has a dividend yield of 2.18%.
3. Broadcom Inc. (NASDAQ:AVGO)
Net Profit Margin: 31.39%
Broadcom Inc. (NASDAQ:AVGO) has quietly positioned itself as a prominent player behind the ongoing artificial intelligence surge. In the third quarter of FY 2025, the company reported about $16 billion in revenue, marking an increase of 22% from the previous year. Its AI-related revenue increased even faster, climbing 63% to $5.2 billion YoY. Most of that development is coming from its networking division, powered by new custom chips such as Tomahawk 6, which effectively doubles the bandwidth for AI data centers.
Broadcom Inc. (NASDAQ:AVGO)’s growing presence in the AI space was reinforced by reports that it is working closely with OpenAI to create a custom AI chip, which would be launched in 2026. This partnership throws light on the power of a highly competitive market focused on the speed and efficiency of the company. With the long-term demand for management and the rapid increase in sales of AI, the company finds a well-deployed approach to maintain a trajectory. Nevertheless, some of its huge dependence on some big customers and already elevated expectations may face further challenges.
Outside the AI, Broadcom Inc. (NASDAQ:AVGO) stands out for its frequent returns for shareholders. The company has raised its dividend for 14 straight years and currently pays quarterly dividends of $0.59 per share. The stock has a dividend yield of 0.70%, as of October 6.
2. Abbott Laboratories (NYSE:ABT)
Net Profit Margin: 32.43%
Abbott Laboratories (NYSE:ABT) has long been a household name in the healthcare world, offering products that reach millions of people every day. Its operations span several major areas, including prescription medicines, medical devices, diagnostics, and nutrition. The company’s portfolio is wide-ranging, covering glucose monitors that help manage diabetes, implantable heart devices, diagnostic tools used in hospitals and labs, and popular nutritional products like Ensure and Glucerna. With a presence in more than 160 countries, Abbott earns a significant portion of its revenue from international markets.
What really makes Abbott Laboratories (NYSE:ABT) stand out is its steady commitment to innovation. The company keeps introducing new technologies that make healthcare easier and more efficient. One clear example is its FreeStyle Libre glucose monitoring system, which has transformed how people with diabetes keep track of their blood sugar levels. Its broad global footprint also helps the company stay flexible with its supply chains and maintain close connections to diverse markets. In an industry constantly evolving due to competition and regulation, Abbott’s ability to adapt and innovate has been a driving force behind its lasting success.
Financially, Abbott Laboratories (NYSE:ABT) has built a reputation as a solid dividend stock. The company has raised its dividend for 53 consecutive years— an achievement that places it among the most consistent dividend payers in the market. Its current quarterly dividend stands at $0.59 per share, translating to a yield of around 1.76%. For investors seeking a stable, long-term holding in the healthcare sector, Abbott remains a solid and trusted choice.
1. Altria Group, Inc. (NYSE:MO)
Net Profit Margin: 37.25%
Altria Group, Inc. (NYSE:MO) stands as one of the leading names in the tobacco industry, with a portfolio that includes well-known brands such as Marlboro, Black & Mild, Copenhagen, and Skoal. The company also belongs to the elite group of Dividend Kings, boasting 56 consecutive years of dividend growth and 60 total increases in that span. Over the last decade alone, its dividend payout has climbed by more than 87%.
Despite its strong dividend history, Altria Group, Inc. (NYSE:MO) continues to face a major challenge: the steady decline in smoking rates among US adults. This trend has weighed on its shipment volumes. However, the company has managed to cushion the impact through its pricing strength. Tobacco remains one of those products with relatively inelastic demand as consumers tend to buy it regardless of price changes or broader economic pressures. While that pricing power has supported results, it’s not a sustainable long-term growth strategy.
Recognizing this, Altria Group, Inc. (NYSE:MO) has been deliberately expanding into smokeless alternatives to reduce its reliance on traditional cigarettes and cigars. Its on! nicotine pouch brand has been a bright spot, with sales volume up 26.5% year over year in the second quarter. Altria’s ability to adapt while maintaining stability makes it a classic long-term dividend stock. Its business model is built for endurance, exactly what income-focused investors look for when aiming to hold a position for many years.
While we acknowledge the potential of MO 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 MO and that has 100x upside potential, check out our report about this cheapest AI stock.
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