Realty Income, Target, and Philip Morris International are three top dividend stocks to consider buying in 2025, even with just $200 to invest. Realty Income, a retail real estate investment trust, leases properties to retail chains that primarily sell essentials. This makes it highly resilient, as seen during the pandemic and recent poor real estate climate.
It has an occupancy rate of 98.7% and rarely dips below that. With more than 15,000 properties, it grows through acquiring new properties and smaller REITs. Realty Income has paid a dividend for 654 consecutive months and raised it for 109 consecutive quarters.
It also offers an attractive monthly dividend yielding 5.9%. Target has paid a dividend since 1967, showcasing the strength of its retail operation. Its shares currently offer a 3.24% yield at $138, with the company only paying out 47% of earnings in dividends.
Target focuses on exclusive product partnerships and its Target Circle 360 program, which drove nearly 20% growth in same-day delivery last quarter. When consumer spending rebounds, Target is well-positioned to benefit. Philip Morris International has outperformed competitors by pivoting to next-generation products like iQOS heat-not-burn tobacco sticks and Zyn nicotine pouches.
These now make up nearly 40% of the company’s revenue. Philip Morris reported 17% organic growth in smoke-free products and 11.6% overall organic revenue growth in the recent quarter. It has also started selling iQOS in the U.S. after acquiring distribution rights from Altria.
The stock currently offers a 4.5% dividend yield. Investing $134,800 in Ares Capital, Enterprise Products Partners, and Verizon Communications could generate over $10,000 in reliable passive income in 2025. Ares Capital, the largest publicly traded business development company, provides financing to middle-market businesses.
It has a forward dividend yield of 8.72%.
Top dividend stocks to consider
Investing one-third of $134,800 (around $44,933) would provide nearly $3,919 in passive income for 2025.
CFO Scott Lem emphasized the stability of their dividends, stating, “Our conservative approach to investing and funding our balance sheet have enabled us to pay a stable to growing regular quarterly dividend for our shareholders for over 15 years.
Enterprise Products Partners, one of the largest U.S. midstream energy companies, operates over 50,000 miles of pipelines. It offers a forward distribution yield of 6.76%. One-third of $134,800 invested would provide a little over $3,037 in annual income.
Enterprise has increased its distribution for 26 consecutive years and its revenue isn’t significantly impacted by oil and gas price fluctuations. Verizon Communications, a telecommunications giant, has a forward dividend yield of 6.79%. Investing the final one-third of $134,800 would generate roughly $3,051 in annual income, bringing the total passive income from these three stocks to over $10,000 in 2025.
Verizon has increased its dividend for 18 consecutive years and its pending acquisition of Frontier Communications is projected to boost revenue and earnings. A.O. Smith Corp., PPG Industries, Donaldson Co., Brown & Brown, Jack Henry & Associates, Lowe’s Cos., and Sherwin-Williams Co. are among the highest quality dividend growth stocks for the long run.
All are Dividend Champions, having increased their payouts for over 25 years. A.O. Smith, a leading manufacturer of water heaters and treatment products, has raised its dividend for 30 consecutive years. PPG Industries, the world’s largest paints and coatings company, reported a slight revenue decline in Q3 2024 but maintained adjusted earnings.
Donaldson, creating filtration solutions since 1915, exceeded Q1 2024 earnings expectations with 6.4% revenue growth. Brown & Brown, an insurance brokerage firm, posted strong Q3 earnings with notable income increases. Jack Henry & Associates, providing IT services to over 1,300 banks, reported solid fiscal Q1 2024 results and forecasts continued growth.
Lowe’s, the second-largest U.S. home improvement retailer, had stable Q3 2024 earnings despite slightly lower sales. Sherwin-Williams, North America’s largest paints and coatings manufacturer, has shown a remarkable ability to maintain and grow its dividend. These companies exhibit strong financials, consistent dividend growth, and solid business models, making them excellent candidates for long-term, dividend-focused portfolios.
