In this article, we will take a look at the 14 Best Low Volatility Dividend Stocks to Invest In.
Morgan Stanley’s Global Investment Committee believes the current bull market still has room to run and could extend into a fourth year. The firm expects the S&P 500 Index to deliver close to double-digit percentage returns, with a projected level of around 7,500. Some strategists are even more optimistic and see the potential for stronger gains.
A major driver behind this confidence is the surge in artificial intelligence spending as companies are investing heavily in AI infrastructure and tools, and investors increasingly see GenAI as a long-term growth engine. The expectation is that these investments will not only support revenue growth but also improve productivity across industries. Earnings expectations reflect that optimism. Analysts are forecasting EPS growth of 14% to 16% in 2026, which is an unusually strong outlook. For the 493 companies in the S&P 500 outside of the “Magnificent 7,” this would mean earnings growth accelerating sharply compared to 2025. In practical terms, it implies that growth would double for the broader market beyond the biggest tech names.
That kind of outlook also raises the stakes. Markets are already trading at elevated valuations, and the largest stocks carry significant weight. The top 10 companies alone now make up about 40% of the index. This concentration means that if earnings fall short of expectations, even slightly, it could put pressure on the broader market. Given this environment, Morgan Stanley is emphasizing quality. The firm sees stronger opportunities in sectors such as financials, healthcare, selected industrials and materials, aerospace, defense, and energy. These areas are viewed as better positioned to deliver steady performance.
The firm also sees value outside the United States. After outperforming U.S. equities in 2025, international stocks still appear relatively inexpensive and supported by solid fundamentals. Emerging markets, in particular, could benefit from easing central bank policies, improving global growth, and a weaker US dollar. Certain Latin American economies may also see added support from the current US policy direction.
Given this, we will take a look at some of the best low-volatility stocks.
Photo by Karolina Grabowska: https://www.pexels.com/photo/hands-holding-us-dollar-bills-4968630/
Our Methodology:
For this list, we screened for companies from different sectors with solid dividend policies and sound financials. From that list, we picked companies with a beta value of less than 1, which shows that these stocks are less volatile than the overall market. The stocks were ranked according to their beta value.
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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
14. International Business Machines Corporation (NYSE:IBM)
Number of Hedge Fund Holders: 63
Beta Value (5Y Monthly): 0.69
According to a February 12 report by Bloomberg, International Business Machines Corporation (NYSE:IBM) said it plans to triple its entry-level hiring in the US in 2026. This comes at a time when AI is widely seen as reducing opportunities for early-career workers across many industries. The company did not share exact hiring numbers. Still, it said the increase would apply broadly, covering multiple departments rather than focusing on just one area. “And yes, it’s for all these jobs that we’re being told AI can do,” said Nickle LaMoreaux, IBM’s chief human resources officer, speaking at a conference in New York this week.
LaMoreaux explained that she revised entry-level job descriptions for software developers and other roles. The goal was to show internally why expanding hiring at this level still made sense. This shift is already changing how junior employees work at IBM. Since AI can now handle much of the routine coding, junior developers are spending less time writing basic code. Instead, they are working more closely with customers and supporting real-world implementation.
A similar change is happening in HR. Entry-level staff are no longer answering every employee’s question directly. Instead, they step in when HR chatbots fail to provide accurate responses. Their role now includes reviewing AI output, correcting errors, and working with managers when needed. LaMoreaux said cutting entry-level hiring might reduce costs in the short term, but it creates long-term risks. Without enough early-career hires, companies may struggle to develop future mid-level managers. That often forces firms to hire from competitors, which tends to be more expensive.
She added that external hires usually need more time to adjust. Employees who grow within the company are already familiar with its systems, culture, and processes.
International Business Machines Corporation (NYSE:IBM) provides hybrid cloud, artificial intelligence, and consulting services worldwide. Its business is organized into Software, Consulting, Infrastructure, and Financing segments.
13. Verizon Communications Inc. (NYSE:VZ)
Number of Hedge Fund Holders: 71
Beta Value (5Y Monthly): 0.32
On February 19, Daiwa upgraded Verizon Communications Inc. (NYSE:VZ) to Buy from Outperform. The firm also raised its price target to $58 from $48. The analyst pointed to the company’s fourth-quarter performance, which showed clear momentum. Verizon reported “stellar” Q4 metrics, including 616,000 postpaid phone net additions. That marked its strongest quarterly result since 2019, according to the research note. The firm believes this trend can continue. It sees the “strong” customer additions in Q4 as sustainable into 2026. Daiwa also highlighted Verizon’s current valuation, which it considers low relative to its outlook. Based on that, the analyst said the stock offers the best risk/reward opportunity in the telecom sector.
During Verizon’s Q4 2025 earnings call, CEO Daniel Schulman spoke about the company’s ongoing transformation. He described it as a broad turnaround effort built on decisive and meaningful changes. A key part of that process involves restructuring the organization, including resizing the workforce, reducing headcount, and eliminating operational overlap. He said these steps are expected to create an in-year OpEx savings pool of $5 billion. Much of the savings will come from workforce reductions. The company also expects gains from more efficient marketing, reduced real estate use, renegotiated contracts, and other cost-cutting efforts.
Schulman also confirmed that Verizon had completed its Frontier acquisition. This expanded the company’s fiber footprint to more than 30 million fiber passings. He said Verizon plans to add at least 2 million more this year. Over the medium term, the company is targeting a total footprint of 40 million to 50 million fiber passings. He added that Verizon now expects to generate more than $1 billion in run-rate operating cost synergies by 2028. That figure is twice the original estimate, reflecting stronger expected benefits from the integration.
In addition, Schulman said Verizon had renewed its MVNO partnership with Comcast and Charter. He described the agreement as financially beneficial and said it would ensure their customers continue operating on Verizon’s network.
Verizon Communications Inc. (NYSE:VZ) operates as a holding company. Through its subsidiaries, it provides communications, technology, information, and streaming services to consumers, businesses, and government customers.
