In this article, we will take a look at the 15 Best S&P 500 Dividend Stocks to Buy in 2026.
Dividend stocks have often provided stability when markets get difficult. Dan Lefkovitz, strategist for Morningstar Indexes, said leaning only on dividend payers tends to pull portfolios toward older, more traditional parts of the market.
He said adding companies that actively buy back their shares creates a mix that looks much closer to the broader market. Lefkovitz pointed to data showing that an index combining dividends and buybacks has delivered better returns than a high-dividend-only index over the past three years, even though it still lagged the overall US market.
Lefkovitz further said the difference comes down to how companies return cash to shareholders. Dividends are a long-term promise, and companies are careful about cutting them once established. Buybacks are more flexible and often increase when management believes the stock is undervalued. In recent years, large technology companies have led buyback activity. Dividend payments, meanwhile, remain concentrated in financials, utilities, energy, and consumer staples. That split has shaped performance as growth-driven sectors have taken the lead.
Lefkovitz added that income-focused investors may want to look outside the US. Dividend yields at home have slipped to around 1.1%, compared with yields above 3% in parts of Europe. At the same time, he cautioned that chasing the highest yields can backfire, as unusually high payouts often signal stress in a company’s business and the risk of future dividend cuts.
Given this, we will take a look at some of the best dividend stocks in the S&P 500.
Photo by Annie Spratt on Unsplash
Our Methodology:
For this list, we screened for S&P 500 companies with a market cap of at least $10 billion and identified stable dividend companies. From that group, we shortlisted stocks with dividend yields of around 2%, as of January 21. Finally, we picked 15 companies that were most popular among hedge funds, as per Insider Monkey’s database of Q3 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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
15. Verizon Communications Inc. (NYSE:VZ)
Number of Hedge Fund Holders: 60
Dividend Yield as of January 21: 7.06%
On January 16, Bernstein cut its price target on Verizon Communications Inc. (NYSE:VZ) to $44 from $46, while sticking with a Market Perform rating. The firm said the industry looks like it is heading into a more aggressive phase of competition. Bernstein noted that through 2025, each quarterly update pointed to intensifying pressure, which ended up wiping out a big portion of the telecom gains seen in the first half of the year. At the same time, cable players continued to lose momentum in the second half, according to the firm. Bernstein expects this tougher competitive backdrop to carry into 2026 as well, with no clear signs of easing after recent strategic moves.
In other news, Reuters reported on January 15 that the California Public Utilities Commission approved Verizon’s $20 billion acquisition of fiber internet provider Frontier Communications, removing the last major hurdle for the deal to close that same day. As part of the approval, Verizon agreed to several conditions, including investing in 75,000 new fiber locations and constructing 25 new wireless towers to expand coverage in rural parts of California. Verizon also committed to additional broadband rollout requirements and pledged to provide free broadband service to many low-income households in the state for at least 10 years. Regulators added that Verizon will also expand its commitments to tribal communities under the agreement.
Verizon Communications Inc. (NYSE:VZ) operates as a holding company and, through its subsidiaries, delivers communication and technology services, along with information and streaming offerings, to consumers, businesses, and government customers.
14. Amgen Inc. (NASDAQ:AMGN)
Number of Hedge Fund Holders: 62
Dividend Yield as of January 21: 3.05%
On January 20, Bernstein downgraded Amgen Inc. (NASDAQ:AMGN) to Market Perform from Outperform, while leaving its $335 price target unchanged. The firm said the decision was mainly driven by its view that “2026 is a waiting year” for MariTide. Bernstein also flagged a few new issues that could hang over the stock, including possible risk to Repatha as Merck’s (MRK) enlicitide pricing comes into focus. The analyst also noted there is still uncertainty around how meaningful Lp(a) outcomes could be, with more clarity expected only after investors can draw comparisons from Novartis’ (NVS) pelicarsen data.
Separately, on January 6, Amgen said it will acquire Dark Blue Therapeutics Ltd., a privately held biotech company based in the U.K. The transaction is valued at up to $840 million.
This deal strengthens Amgen’s oncology pipeline by adding an investigational small molecule aimed at degrading two proteins, MLLT1/3, which are believed to drive certain forms of acute myeloid leukemia (AML), a fast-moving blood cancer. Amgen pointed to encouraging preclinical results in leukemia models, showing anti-cancer activity and a mechanism that appears distinct from existing treatments. That differentiation could support both single-agent use and combinations, especially in cases where resistance becomes a problem and longer-lasting remission is the goal.
Amgen also said it plans to integrate Dark Blue into its existing research organization, which should further support its early-stage oncology discovery work.
Amgen Inc. (NASDAQ:AMGN) is a global biotech company focused on discovering, developing, manufacturing, and delivering innovative medicines for patients facing some of the world’s toughest diseases.
