In this article, we will take a look at the Top 5 Undervalued Dividend Stocks to Buy Now. For a deeper discussion and analysis, please refer to the Top 12 Undervalued Dividend Stocks to Buy Now.
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5. Energy Transfer LP (NYSE:ET)
Forward P/E Ratio: 11.51
Dividend Yield as of May 17: 6.70%
Energy Transfer LP (NYSE:ET) is one of the largest and most diversified midstream energy companies in North America, with a strategic footprint in all of the major US production basins.
On May 13, BofA bumped up its price target on Energy Transfer LP (NYSE:ET) from $22 to $24, while maintaining a ‘Buy’ rating on the shares. The firm cited improving NGL and gas upside for the target boost, which represents an upside of over 19% from the current price levels.
The move comes despite Energy Transfer LP (NYSE:ET) reporting mixed results for its Q1 2026 on May 5. The company’s adjusted profit of $0.35 per share fell behind estimates by $0.02, but its revenue grew by over 32% YoY to $27.8 billion and exceeded expectations by $470 million. Moreover, the midstream operator’s adjusted EBITDA for the quarter came in at $4.94 billion, compared to $4.10 billion in the same period last year.
Energy Transfer LP (NYSE:ET) also raised its guidance for FY 2026. The company now expects its adjusted EBITDA for the year to range between approximately $18.2 billion and $18.6 billion, up from its previous range of $17.45 billion and $17.85 billion. Moreover, it expects to invest $5.5 billion to $5.9 billion in growth capital for the current year.
4. Edison International (NYSE:EIX)
Forward P/E Ratio: 11.26
Dividend Yield as of May 17: 5.08%
Edison International (NYSE:EIX) is one of the largest electric utility holding companies in America, focused on providing clean and reliable energy and energy services through its independent companies.
On May 15, JPMorgan slightly raised its price target on Edison International (NYSE:EIX) from $75 to $76, while maintaining a ‘Neutral’ rating on the shares. The revised estimate, which indicates an upside of almost 10% from the current price levels, marks the second target boost that EIX has received from the renowned analyst firm in two weeks.
The bullish sentiment comes after Edison International (NYSE:EIX) beat profit estimates in its Q1 2026 report last month. The company increased its core earnings by $0.05 to $1.42 per share during the quarter, primarily due to the adoption of the GRC decision last year. However, its revenue fell slightly behind estimates, despite a YoY growth of over 7%.
Edison International (NYSE:EIX) also reiterated its 2026 core EPS guidance range of $5.90 to $6.20, in addition to expressing confidence in achieving its target of 5-7% core EPS growth from 2025-2030.
3. HSBC Holdings plc (NYSE:HSBC)
Forward P/E Ratio: 10.93
Dividend Yield as of May 17: 4.24%
HSBC Holdings plc (NYSE:HSBC) is one of the largest banking and financial services institutions in the world, serving millions of customers through its four global businesses.
On May 14, RBC Capital increased its price target on HSBC Holdings plc (NYSE:HSBC) from £1,200 to £1,275, while maintaining a ‘Sector Perform’ rating on the shares. The move comes a few days after JPMorgan also bumped up its price target on the stock by £10, while keeping its ‘Neutral’ rating (read more details here).
The target boosts come despite HSBC Holdings plc (NYSE:HSBC) reporting a pre-tax profit of $9.4 billion for the quarter, falling behind estimates on the back of higher expected credit losses and other impairment charges. However, the bank’s revenue surged by over 5% YoY to $18.6 billion and topped expectations on stronger wealth fees and other income.
HSBC Holdings plc (NYSE:HSBC)’s expected credit losses soared by 44% YoY to $1.3 billion during the quarter, driven primarily by the “fraud-related” exposure to a financial sponsor in the UK and provisions owed to a worsening economic outlook due to the ongoing US-Iran war.
With an impressive annual dividend yield of 4.24%, HSBC Holdings plc (NYSE:HSBC) was also recently included in our list of the 12 Best Blue Chip Dividend Stocks to Buy Now.
2. Verizon Communications Inc. (NYSE:VZ)
Forward P/E Ratio: 9.52
Dividend Yield as of May 17: 6.06%
Verizon Communications Inc. (NYSE:VZ) engages in the provision of communications, technology, information, and streaming products and services to consumers, businesses, and governmental entities worldwide.
It was reported on May 14 that the Federal Communications Commission has approved Verizon’s spectrum purchase from Array Digital Infrastructure. The $1 billion deal is meant to expand the company’s network capacity and coverage and includes Array’s AWS-3, AWS-1, and PCS licenses covering nearly 8% of the US population.
According to the FCC, the acquisition will enhance Verizon Wireless’ “network coverage, capacity and performance, resulting in a stronger ability to meet increasing customer demand and provide a better customer experience.”
The announcement comes a few days after Verizon Communications Inc. (NYSE:VZ) reported better-than-expected profits for its Q1. Moreover, the company delivered 55,000 postpaid phone net adds in the quarter, underscoring its successful efforts to lure in new wireless customers despite the intense competition.
Given the strong performance, Verizon Communications Inc. (NYSE:VZ) expects total postpaid phone net adds to be at the upper end of its forecast of 750,000 to 1 million for FY 2026. Moreover, the company raised its guidance for adjusted EPS growth to 5% to 6%, compared to its prior range of 4% to 5%.
1. Comcast Corporation (NASDAQ:CMCSA)
Forward P/E Ratio: 7.57
Dividend Yield as of May 17: 5.33%
Topping our list of the Most Undervalued Dividend Stocks is Comcast Corporation (NASDAQ:CMCSA). The company delivers industry-leading broadband, mobile, and entertainment platforms that power incredible experiences for customers globally.
Comcast Corporation (NASDAQ:CMCSA) declared a quarterly dividend of $0.33 per share on May 14. The dividend is payable on July 22 to shareholders as of the July 1 record. Comcast has increased its quarterly payout for 17 consecutive years and currently boasts a robust annual dividend yield of 5.33%.
Comcast Corporation (NASDAQ:CMCSA) reported better-than-expected results for its Q1 2026 last month, beating estimates in both earnings and revenue. A blockbuster sports lineup helped boost the company’s subscriber growth and engagement, while its core broadband business lost fewer customers than initially expected.
Comcast shed 65,000 broadband customers during the quarter, less than the estimated loss of 175,500 users. Moreover, with 435,000 new customers, the company delivered the best wireless net additions of any quarter in its history. At the same time, the firm’s theme park business posted a 24% increase in revenue and 33% increase in EBITDA, led by higher attendance at its Epic Universe park in Orlando. Notably, Comcast revealed that Peacock is expected to approach profitability for the first time in the second quarter.
While we acknowledge the potential of CMCSA 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 CMCSA and that has 100x upside potential, check out our report about the cheapest AI stock.
READ NEXT: 12 Best Blue Chip Dividend Stocks to Buy Now and 11 Best Rising Dividend Stocks to Buy Right Now
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