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Analyst Recommends This Top Dividend Growth Stock for ‘Ability to Sleep at Night’

David Bahnsen, The Bahnsen Group CIO, recently talked on CNBC about the importance of dividend growth stocks and said the “ability” to sleep at night that these stocks give to investors comes from their strong track record. He believes dividend growth “immunizes” investors from volatility.

“I think you get some of that ability to sleep at night if you’re not so reliant on expensive things getting more expensive. That’s really the key, is you already have the things you’re talking about — top-down macro uncertainty, tariff policy, geopolitics, things like that. But when you combine that with high PEs that you just need to get higher in order to see your investments do well, I think that becomes problematic. Dividend growth immunizes investors from some of that.”

Bahnsen then talked about why he loves International Business Machines (NYSE:IBM) as a dividend growth play:

Well I love talking about IBM Common Stock (NYSE:IBM) and that’s one of the names that’s done really well this year. There’s other names that haven’t done as well, which I like even more because they’re cheaper. IBM’s up 20%, but here’s the thing. It’s trading at 17 or 18 times what 2025 free cash flow will be. You’re talking about that up against other names trading at 40, 50, 60 times what their free cash flow may be. IBM Common Stock (NYSE:IBM) has grown the dividend, Kelly, every single year since 1994. Think about how much has gone on in the world over that 30 plus years. IBM’s grown the dividend every year in that period. Impressive. So we just think it’s a great name that’s tethered to both old tech and new tech.

Image by Steve Buissinne from Pixabay

IBM is indeed making a comeback. As of the end of Q4, IBM’s AI products and services surpassed $5 billion in total bookings, with $2 billion added just since last quarter. Last year, IBM updated its Granite family of AI models for enterprise use, making them about 90% more cost-efficient than large models. RedHat is also key in IBM’s open-source GenAI strategy. Management highlighted that RHEL AI and OpenShift AI platforms are gaining traction, along with IBM’s watsonx AI solutions. The company expects its software business to grow by at least 10% in 2025, up from 8.3% growth in 2024.

While we acknowledge the potential of IBM as an investment, 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 extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. This article is originally published at Insider Monkey.

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

Dr. Inan Dogan

Dr. Ian Dogan

Co-Founder and Research Director at Insider Monkey

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.

It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

And this breakthrough has already set off a frenzy among hedge funds and Wall Street’s top investors.

What most investors don’t realize is that one under-owned company holds the key to this $250 trillion revolution.

In fact, Verge argues this company’s supercheap AI technology should concern rivals.

Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.

  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

Even as we admire what Tesla, Nvidia, Alphabet, and Microsoft have built, we believe an even greater opportunity lies elsewhere…

But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.

And judging by what I’m hearing from both Silicon Valley insiders and Wall Street veterans…

This prediction might not be bold at all:

A few years from now, you’ll wish you’d owned this stock.

The best part? You can discover everything about this company and its groundbreaking technology right now.

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Wall Street calls this $3 stock a “Melting Ice Cube.” They said the same thing about BTI before it returned 90%.

Dr. Inan Dogan

Dr. Ian Dogan

Co-Founder and Research Director at Insider Monkey

My name is Inan Dogan. I’m the co-founder and Research Director of Insider Monkey. I have an important message for you today.

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We looked under the cover and realized they were wrong.

We alerted our subscribers, and BTI returned 90% in just 16 months.

Now if you had invested just $10,000 in BTI in June 2024, you’d be sitting on $19,000 in October 2025.

Today, we have identified a nearly identical pattern in a digital-first giant trading at $3.

While the market panics over a surface-level revenue decline, our PhD-led research shows management has actually surgically cut $100 million in waste to focus on high-margin growth.

This pattern is a hallmark of our 16.5% annual return track record. The current opportunity offers a 400% upside potential—dwarfing even our 90% BTI return.

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