Top Dividend Stocks to Watch in 2021
In the world of investing, dividend stocks have long been a favorite among investors looking for stable income and long-term growth potential. With the economic uncertainty brought on by the COVID-19 pandemic, dividend stocks have become even more attractive as a way to generate passive income while weathering market volatility. If you’re looking to add dividend stocks to your portfolio in 2021, here are some top picks to consider.
Dividend Aristocrats
Dividend Aristocrats are companies that have not only paid dividends consistently but have also increased their dividends for at least 25 consecutive years. These companies are known for their solid financial performance and commitment to returning capital to shareholders. Some of the top Dividend Aristocrats to watch in 2021 include:
1. Procter & Gamble (PG) – With a track record of over 60 years of consecutive dividend increases, Procter & Gamble is a household name with a history of steady growth and reliable dividend payouts.
2. Coca-Cola (KO) – Coca-Cola is another Dividend Aristocrat with a long history of dividend increases and a dominant position in the global beverage market.
3. Johnson & Johnson (JNJ) – Known for its diverse healthcare products and strong financials, Johnson & Johnson is a solid choice for investors seeking stability and growth.
High-Yield Dividend Stocks
While Dividend Aristocrats are known for their consistent dividend increases, high-yield dividend stocks offer investors the opportunity to earn a higher dividend yield on their investment. These stocks may come with higher risks, but for income-oriented investors, the potential for higher returns can be worth it. Some high-yield dividend stocks to watch in 2021 include:
1. AT&T (T) – With a dividend yield of over 7%, AT&T is a telecommunications giant that offers a steady stream of income for dividend investors.
2. Exxon Mobil (XOM) – Despite challenges in the energy sector, Exxon Mobil remains a top pick for dividend investors with a dividend yield above 8%.
3. Altria Group (MO) – As a leading tobacco company, Altria Group offers a high dividend yield of over 8%, making it an attractive choice for income-focused investors.
Technology Dividend Stocks
Traditionally, technology companies have not been known for paying dividends, as they tend to reinvest their profits into research and development. However, some tech companies have started to pay dividends as they mature, making them an attractive option for investors seeking growth and income. Some top technology dividend stocks to watch in 2021 include:
1. Microsoft (MSFT) – With a dividend yield of around 1%, Microsoft has emerged as a leader in the technology sector while also rewarding shareholders with dividend payouts.
2. Apple (AAPL) – As one of the most valuable companies in the world, Apple offers a modest dividend yield of around 0.7% along with the potential for long-term growth.
3. Cisco Systems (CSCO) – Cisco Systems is a leading provider of networking technology with a dividend yield of approximately 3%, making it a solid choice for investors seeking income and stability.
REITs (Real Estate Investment Trusts)
Real Estate Investment Trusts (REITs) are companies that own, operate, or finance income-generating real estate across a range of property sectors. REITs are required by law to pay out at least 90% of their taxable income to shareholders in the form of dividends, making them a popular choice for income investors. Some top REIT dividend stocks to watch in 2021 include:
1. Realty Income Corporation (O) – Known as “The Monthly Dividend Company,” Realty Income Corporation pays dividends on a monthly basis, making it a reliable source of passive income for investors.
2. Simon Property Group (SPG) – As a leading retail REIT, Simon Property Group offers a dividend yield of around 5% and exposure to the retail sector.
3. Prologis (PLD) – Prologis is a global leader in logistics real estate with a dividend yield of approximately 2%, making it a top pick for investors seeking exposure to e-commerce and logistics trends.
In conclusion, dividend stocks can be a valuable addition to any investment portfolio, providing a source of passive income and potential for long-term growth. By diversifying your holdings across different sectors and focusing on companies with a history of consistent dividend payments, you can build a resilient portfolio that can weather market fluctuations and generate steady returns over time. Consider adding some of these top dividend stocks to your watchlist in 2021 to take advantage of their income potential and growth opportunities.
