My Favorite Safe Stocks That Pay Dividends
Let’s discuss the best consistent dividend stocks today.
Why? Because dividend stocks and the stock market can be a wild, unpredictable ride. The surprise events of 2020 proved this once again.
So, let’s smooth out this roller coaster ride the best we can. We will do this with a review of 5 top consistent dividend-paying stocks.
5 Consistent Dividend Stocks To Buy And Hold
Here are 5 consistent dividend stocks we will review today.
- NextEra Energy
- Hormel Foods
- Johnson & Johnson
First of all, these stocks can be a solid starting point for a dividend investment portfolio. Stick with strong companies like these. And it’s tough to go wrong.
Furthermore, put yourself on a path to building cash flow from dividends. And maybe becoming a dividend millionaire. Who knows?
Finally, each of these stable dividend stocks is a member of the Dividends Diversify model stock portfolio. Be sure to check out all of the dividend stocks in the portfolio before you leave today.
Disclosure: At no cost to you, I may get commissions for purchases made through links in this post.
Dividend Investing Resources
If you are looking for even more consistent dividend stock suggestions, I use the Simply Investing report.
The Simply Investing report provides analysis on hundreds of dividend stocks. And recommends the best ones to buy, and when to buy them.
Also, make sure you keep your stock trading costs to a minimum. There is no need to pay commissions when you buy or sell a dividend stock.
I use the Webull stock trading app. It is an excellent tool. It’s free. And for a limited time get free stock just for signing up and funding your account. Don’t miss out on free stock! Sign up now.
Now, let’s move on with our review of the most consistent dividend paying stocks.
Consistent Dividend Stock #1: Walmart (NYSE: WMT)
To kick off our list of consistent dividend stocks, we have Walmart.
Walmart is an American multinational retail corporation.
They operate a chain of hypermarkets, discount department stores, and grocery stores. The company has thousands of stores and clubs in dozens of countries.
Walmart does business through 3 operating segments:
- Walmart U.S.
- Sam’s Club
- Walmart International
The U.S. segment contributes the greatest share of company sales and profit.
Headquartered in Bentonville, Arkansas, Walmart was founded by Sam Walton in 1962. And was incorporated on October 31, 1969.
Walmart Dividend Information
Want to start the year out with some dividends in January? Then Walmart is a good choice.
The stock is a January dividend payer. And you will receive 3 more quarterly payments before the year is over.
A few other facts and figures about the Walmart dividend:
- Recent dividend yield: 1.7%
- 7-year dividend growth rate: 4.2%
- Dividend payout ratio: 40%
Walmart stock has a low dividend yield. And, a relatively low dividend growth rate. I do not find either of these metrics very attractive.
Then why do I like Walmart stock? Because Walmart stock has held up very well in both of the last 2 recessions.
First of all, when the economy stumbles and the stock market follows, Walmart stock performs.
Furthermore, no matter the economic conditions, people like you and I still need groceries and household goods.
Finally, Walmart has made progress with e-commerce to compete with Amazon.
These characteristics make Walmart one of the most consistent dividend paying stocks.
Related: Walmart dividend stock analysis
Consistent Dividend Stock #2: NextEra Energy (NYSE: NEE)
My list of consistent dividend paying stocks continues with NextEra Energy.
NextEra is one of the largest electric power and energy infrastructure companies in North America. The company is also a leader in the renewable energy industry.
NextEra has two primary businesses, Florida Power & Light (FPL) and NextEra Energy Resources (NEER).
FPL is the largest electric utility in the state of Florida and one of the largest electric utilities in the U.S. Also NEER is the world’s biggest generator of renewable energy from the wind and sun.
NextEra Dividend Information
- Recent dividend yield – 2.0%
- 7-year dividend growth rate – 11.1%
- Dividend payout ratio – 60%
NextEra is a bit unique for a utility dividend stock. First of all, utilities normally have higher dividend yields. Furthermore, utility stocks have higher dividend payout ratios. Finally, lower dividend growth rates are typical of the utility sector.
NextEra management has put in place an excellent dividend policy. And, with a modest payout ratio at 60%, expect the dividend increases to keep rolling from NextEra Energy.
Why is NextEra Energy one of the most consistent dividend stocks? Even during a recession, there is a relatively stable demand for electricity.
Consistent Dividend Stock #3: Clorox
Here is a stable dividend stock for sure, the Clorox Company.
Clorox is a leading manufacturer and marketer of consumer products. Clorox markets some very trusted and recognized brands in the household products and food and beverage categories.
Here are a few of the company’s popular brands:
- Clorox bleach and cleaning products
- Pine-Sol cleaners
- Liquid Plumber clog removers
- Kingsford charcoal
- Hidden Valley dressings and sauces
- Glad bags, wraps, and containers
- Burt’s Bees personal care products
- Brita water filters
Clorox has tremendous brand strength. More than 80 percent of the company’s sales are generated from brands that hold the number 1 or 2 market share positions in their categories.
Clorox Dividend Information
- Recent dividend yield: 1.9%
- 7-year dividend growth rate: 7.5%
- Dividend payout ratio: 60%
First of all, I think Clorox is very well managed. Furthermore, they have excellent brands. Finally, they have a long track record of rewarding shareholders with regular dividend payouts.
I have been waiting for a stock market correction to add to my shares. We got the stock market correction in early 2020. But the Clorox stock price did not stumble.
Demand for cleaning products and household goods skyrocketed. And increased demand took Clorox stock to new highs.
Clorox stock hardly ever goes down. To increase my shares, I’m going to make small purchases over time. This is known as dollar-cost averaging.
Related: Clorox dividend stock analysis
Consistent Dividend Stock #4: Hormel Foods (NYSE: HRL)
Here is one of the best dividend stocks to buy now and hold for the long-term, Hormel Foods.
Hormel manufactures and markets high-quality, brand-name food and meat products. Their brands number more than 50.
You may have consumed one or more of their products. A few examples include:
- Dinty Moore
- Lloyd’s Barbeque
- Wholly Guacamole
The company’s brands hold the number 1 or number 2 market share in more than 35 categories.
Hormel Dividend Information
We have a Dividend King here. Hormel has increased its dividend annually for 54 consecutive years. Dividend Kings are those rare companies that have increased their dividends annually for at least 50 years.
- Recent dividend yield: 1.8%
- 7-year dividend growth rate: 15%
- Dividend payout ratio: 46%
What I like are 2 specific features about the Hormel dividend. First, HRL has a long track record of annual dividend increases. Second, rapid dividend growth.
Finally, we will all continue to eat no matter the economic conditions. And I think Hormel strikes a nice balance between lower-cost products. Plus higher-end niche products for those of you that don’t mind spending a bit more.
Related: Hormel Foods dividend stock analysis
Consistent Dividend Stock #5: Johnson & Johnson (NYSE: JNJ)
Next, we have a very safe stock that pays dividends, Johnson and Johnson
JNJ is the world’s largest and most broadly-based healthcare company. They do business through 3 operating segments:
- Consumer products
- Medical devices
- Pharmaceutical products
Johnson & Johnson Dividend Information
- Recent dividend yield: 2.8%
- 7-year dividend growth rate: 6.3%
- Dividend payout ratio: 66%
Like Hormel, JNJ is a Dividend King with bragging rights to 58 consecutive years of dividend increases!
And similar to food, electricity, and basic consumer goods, health care isn’t going out of style anytime soon. A large diversified health care company like JNJ can ride out the troubles of the worst recessions.
Related: JNJ dividend stock analysis
That wraps up our review of 5 consistent dividend stocks to buy and hold. If you are interested in any of them be sure to check out the links above to more in-depth dividend stock reviews for each company.
But there’s more.
Before we finish, I think it’s a good time to answer a few questions. The questions I frequently get from readers about earning dividend income from dividend stocks. They relate to our topic today: investing in top consistent dividend-paying stocks.
What Is The Safest Dividend Paying Stock?
Remember that every stock investment opportunity has risk. Look for these characteristics to find the safest dividend-paying stocks.
First of all, a recession-resistant business model. Further, a long track record (at least 10 years) of paying increasing dividends. Finally, a dividend payout ratio of less than 60%.
The consistency of continued dividend payments no matter the situation is key. Using these criteria, Hormel Foods looks to be the safest dividend stock from our list today.
To Have Dividend Investing Success, What Is A Good Dividend Yield?
Having financial success with dividend income investing is the goal. And sometimes we are tempted by high dividend yields.
But, higher dividend yields usually mean greater investment risk. These risks include the potential for a dividend reduction in the future. When a company reduces its dividend, the share price usually falls dramatically.
I like dividend yields in the 3-5% range. Combine a 3-5% dividend yield with a long history of paying annual dividends. Then, you have good dividend stock to further analyze for your investment dollars.
Just make sure you trade stocks for free. You don’t want trading commissions eating into your dividends.
I use the fast and powerful Webull app. And never, ever pay commissions to trade stocks. Plus, for a limited time get free stock for opening and funding your account.
Are Dividend Stocks Worth It?
First of all, dividend growth stocks offer income today. Furthermore, they provide increasing dividend income in the future from dividend raises. Finally, their share prices usually appreciate over the long run.
Based on these 3 factors, I look at dividend stocks as a triple play on your way to becoming a dividend millionaire.
I Want To Become A Dividend Millionaire: How Many Stocks Should I Own?
There is no exact answer here. But, academic research suggests 20-25 is enough to provide adequate diversification.
If you are a beginning investor, don’t let that scare you away. Aim for 3 to 5 dividend stocks in your investment portfolio to get started.
Make sure each stock is from a different industry. And, provides essential services or products to reduce investment risk.
Just look at the industries our 5 stocks reviewed today operate in:
- Electric utility
- Cleaning products and consumer goods
- Health care
Another option is to invest in a dividend-paying exchange-traded fund (ETF). Here are several of my favorite dividend-paying ETFs. All of them are from Vanguard.
Are you looking for more top consistent dividend stocks? Then, be sure to check out the Simply Investing report.
Any way you want to go about it, handpicking your dividend stocks, investing in dividend ETFs, or supplementing your research with the Simply Investing report, YOU CAN DO IT.
There are plenty of dividend reinvestment millionaires out there! You can become a dividend millionaire and live off dividends too.
Summary: 5 Consistent Dividend Stocks To Buy And Hold
These 5 companies value dividend payments as a way to reward shareholders.
- NextEra Energy
- Hormel Foods
- Johnson & Johnson
As a final thought, be aware that these company’s stocks rarely go on sale at attractive valuations.
So, I intend to add to my positions in small amounts over the long-term. Collect my dividends. And hold these stocks forever in my collection of dividend stocks.
Further Reading For An Aspiring Dividend Millionaire
- Simply Investing report review and assessment
- The Little Book of Big Dividends book review
- Dividends Still Don’t Lie book review
- Another stable stock paying dividends
Dividend Investing Success Resources
Disclosure & Disclaimer
This article, or any of the articles referenced here, is not intended to be investment advice specific to your situation. I am not a licensed investment adviser, and I am not providing you with individual investment advice. The only purpose of this site is information & entertainment. We are not liable for any losses suffered by any party because of information published on this blog. See this site’s Disclaimer and Privacy tab for more information.