Choosing to invest in dividend-paying stocks in general is a relatively safe strategy. But maybe you want the most reliable, safest dividend stocks in the market for retirement or passive income. Look no further. We’ve compiled a list of the top 10 high-dividend, safe stocks:

  • Verizon (VZ)
  • Enterprise Products (EPD)
  • Kinder Morgan (KMI)
  • Sherwin-Williams Company (SHW)
  • Nordson Corporation (NDSN)
  • Enbridge (ENB)
  • AT&T (T)
  • Lowe’s Companies (LOW)
  • Dover Corporation (DOV)
  • Church & Dwight Co (CHD)

That being said, the best blue chip dividend stocks are constantly evolving as market conditions change, companies run into financial trouble, and new companies thrive. 

So rather than just giving you a list of stocks, we’re going to show you how to find these opportunities through traditional forms of stock analysis and how to uncover them on autopilot with our stocks software.

VectorVest ranks 16,000 stocks on a daily basis and has a list of the Top Dividend stocks that reflect current market conditions, so you never have to play the guessing game in choosing your stocks. Streamline your strategy with the best stock picking service today!  

The Basics of Dividend-Paying Stocks

Dividend-paying stocks are shares of companies that return a portion of company profits to shareholders on a regular basis. This is the main difference between dividend vs growth stocks, which reinvest company profits to fuel additional growth.

Dividends are most commonly paid in cash but can also be issued as shares of stock or other property. But how often are stock dividends paid? It all depends, as you can find anything from safe monthly dividend stocks to quarterly. They can also be issued as special dividends in response to exceptional company earnings. 

Key Terms for Dividend Investing

Here are a few terms you should familiarize yourself with if you’re going to make these stocks a part of your stock trading system:

  • Dividend Yield: The ratio of a company’s annual dividend compared to its share price. It is expressed as a percentage and illustrates the dividend as a return on the investment.
  • Ex-Dividend Date: Investors have to buy stock before the ex-dividend date to receive the declared dividend. 
  • Record Date: This is the date on which a company determines its shareholders or “records” who owns the stock. Only those registered as shareholders on this date will receive the dividend.
  • Payment Date: This is when the dividend payment is actually made to shareholders.

The Reasoning Behind Dividends

These payments are issued by companies as an incentive for current investors to remain loyal and to encourage new investors. Many companies use dividends as an investor sentiment tactic, as increasing payouts signal prosperity and can drive share prices higher.

So, why are dividend stocks worth it from the investor’s standpoint? They are particularly intriguing for investing after retirement as they can generate supplemental income while preserving or even growing the value of your portfolio for the long run.

However, you don’t have to be trying to live off dividends in retirement or even investing for early retirement at all to reap the benefits of these stocks. If you have financial obligations you want assistance with and cash sitting in a savings account, investing it in safe dividend-paying stocks can be the answer.

But, you’re here to learn about safe dividend stocks. This begs the question…is dividend investing safer than other strategies? 

Is Dividend Investing Safer Than Other Strategies?

Yes, dividend investing is often perceived as a safer strategy compared to other investment approaches, particularly for those seeking stability and consistent returns. The reasoning is simple: companies that issue dividends are in a stable financial position.

They have a track record of profitability and a clear policy of sharing profits with shareholders, which can contribute to their overall lower volatility. 

From the investor’s perspective, dividend stocks are predictable. You more or less know when to expect your dividend payout and what you’ll earn as a shareholder. While things do change and dividends do get cut, investing in the safest dividend stocks comes with some level of consistency.

These stocks are also great for diversification if you’re already holding aggressive investment companies. Dividend stocks tend to be in different sectors than high-growth non-dividend stocks, say utilities or consumer goods compared to tech or medical.

All this being said, not all dividend stocks are created equal, and no investment is without any risk. This is why learning how to find the safest dividend stocks is so important. So, let’s talk about what to look for below.

What to Look For in Safe Dividend Stocks

Don’t worry – we’re still going to list out the best safe dividend stocks in a few moments. But we want you to be able to continuously update your portfolio with the safest dividend-paying stocks at any given time, which is why you need to know what separates the best from the rest.

Really, there are just three things you need to consider in vetting a stock: financial health, dividend history, and sector stability. 

Financial Health Indicators

There are so many different stock technical indicators you can use to analyze a company’s financial health. Here are the most important:

  • Payout Ratio: This measures the proportion of earnings a company pays to shareholders as dividends. A sustainable payout ratio (generally 60% or less) suggests that the company can comfortably cover its dividend payments without putting itself in a compromising financial situation.
  • Debt-to-Equity Ratio: This assesses a company’s financial leverage relative to its shareholder equity. A lower ratio indicates that the company is not overly reliant on debt, meaning the stock is less risky in times of economic uncertainty.
  • Free Cash Flow: Strong free cash flow indicates that a company has enough liquidity to support dividend payments, invest in business growth, and manage unexpected expenses without worry.
  • Interest Coverage Ratio: This evaluates a company’s ability to meet its interest obligations. A higher ratio indicates that earning power comfortably exceeds interest expenses, which is crucial for long-term dividend safety.

There are a few other things you should dig into as well, including the company’s earning stability. Companies with predictable earnings are more likely to maintain consistent dividend payments.

Better yet, see if the company offers visibility into future earnings through quarterly forecasts as this shows confidence about ongoing dividend sustainability.

You can also get a sense of how financially stable a company is by looking at its market position. Those with a stranglehold on their industry or a competitive edge of some sort typically exhibit more stability and less volatility. 

Dividend History and Consistency

One of the most common ways to assess how safe a dividend-paying stock is? Look to the past as your guide! 

Long histories of dividend payments can be a good indicator of a company’s commitment to shareholders and financial health going forward. On the other hand, if a company offers a high dividend yield today but has a track record for cutting dividends at the first sign of economic uncertainty, you may want to save yourself the trouble.

Assess the dividend growth rate over time, too. Consistent increases in dividend payouts over the years signal a healthy, growing company and offer inflation protection for investors’ income.

Sector Stability

Finally, consider the stability of the sector a company operates in when determining how safe it is. 

Sectors that tend to perform well across various economic conditions, such as utilities or consumer staples, often feature safer dividend stocks. They’re less sensitive to economic downturns as they’re more essential.

But you should also look at how regulated a sector is, as this can significantly impact companies’ operations and, consequently, their ability to pay dividends.

 

Our blog has more resources on how to pick a stock if you’d like to learn more. We have resources on how to start building a stock portfolio from scratch, how to do fundamental analysis of stocks, how to combine fundamental and technical analysis, and more.

At this point, though, it’s time we pulled the curtain back on the safest dividend stocks in 2024!

So, What are the Safest Dividend Stocks in 2024?

Verizon (VZ)

Yield: 6.78%

Uninterrupted Dividend Streak: 40 years

This leader in telecommunications has demonstrated its commitment to shareholders through a four-decade-long record of uninterrupted dividends. 

The company’s investment in 5G technology peaked in 2022, which should free up more cash flow moving forward, supporting its generous and sustainable dividend payments.

Enterprise Products Partners (EPD)

Yield: 7.12%

Uninterrupted Dividend Streak: 25 years

As a major player in the midstream oil and gas sector, Enterprise Products’ business model is backed by long-term, fixed-fee contracts. This structure has protected the company’s cash flows from volatile commodity prices, supporting a strong track record of dividend growth since its IPO in 1998.

Kinder Morgan (KMI)

Yield: 6.12%

Uninterrupted Dividend Streak: 7 years

Kinder Morgan has enhanced its business stability by moving to a self-funding model, reducing debt, and improving its credit rating. With a conservative payout ratio and revenues primarily derived from fee-based contracts, the company is positioned well for ongoing dividend reliability.

Sherwin-Williams Company (SHW)

Yield: 0.84%

Dividend Growth Streak: 45 years

Known for its paints and coatings, Sherwin-Williams has raised its dividend by 18.2% recently, continuing a near-half-century tradition of annual increases. This growth signals strong operational performance and shareholder value focus.

Nordson Corporation (NDSN)

Yield: 1.03%

Dividend Growth Streak: 60 years

With a remarkable six-decade streak of dividend growth, Nordson, which specializes in precision dispensing equipment, is a financially durable company with a clear commitment to returning value to shareholders.

Enbridge (ENB)

Yield: 7.39%

Uninterrupted Dividend Streak: 71 years

Enbridge operates a vast infrastructure network for energy distribution in North America. The company’s revenue is largely generated from fixed-fee, long-term contracts. This ensures a steady dividend, which has been reliably paid and often increased since 1953.

AT&T (T)

Yield: 6.69%

Uninterrupted Dividend Streak: 1 year

We know what you’re thinking…why is AT&T on this list with just a single year of dividends under its belt? 

It recently refocused on its core telecommunications and broadband businesses. It now shows signs of growth and improved financial health, making its high yield increasingly sustainable.

Lowe’s Companies (LOW)

Yield: 1.82%

Dividend Growth Streak: 59 years

As a leading home improvement retailer, Lowe’s has not only consistently paid but also raised its dividends for nearly six decades, demonstrating strong sector performance and shareholder commitment.

Dover Corporation (DOV)

Yield: 1.19%

Dividend Growth Streak: 67 years

Dover’s long-standing record of dividend increases is the direct results of its diversified industrial products and services, which contribute to steady cash flows and financial stability.

Church & Dwight Co (CHD)

Yield: 1.09%

Dividend Growth Streak: 28 years

Known for its household products, Church & Dwight’s consistent dividend increases over nearly three decades highlight its operational efficiency and steady demand for its products.

Finding the Safest Dividend Stocks Becomes a Whole Lot Easier With VectorVest!

Wouldn’t it be nice if you could constantly pull up the safest dividend-paying stocks on any given day rather than having to use free stock analysis websites and dig through the data yourself? You can with VectorVest, the best stock analysis app for beginners and experts alike!

Our stock advisory aligns with a variety of strategies for investing in stocks, from blue chip investing to high volatility stocks. It’s outperformed the S&P 500 index by 10x over the past 20 years and counting, empowering traders to earn higher returns with far less stress and time.

This is because it takes complex technical data and boils it down into clear, actionable insights. In fact, you’re given all the information you need to make calculated investment decisions in 3 simple ratings, each of which sits on an easy-to-interpret scale of 0.00-2.00 with 1.00 being the average. 

Better yet, you can just follow the buy, sell, or hold recommendation VectorVest offers for the 16,000+ stocks tracked and ranked on a daily basis. No need to let emotion, human error, or guesswork get in the way of profits!

You can simply pull the app up on a daily basis and filter your search for opportunities by the “Top Dividend Stocks”, or the “Safest Stocks With a Buy Rating”. There are tons of filters you can apply to make sure you’re getting insights that align with your strategy.

Whether you need the best stock apps for iPhone or the best stock apps Android, you can rest assured you’re setting yourself up for success with VectorVest. But why not see firsthand how it can elevate your trading strategy? Get a free stock analysis today!

Parting Thoughts on the Best Safe Dividend Stocks

That wraps up our guide to the safest dividend stocks in the market today. But because what is considered the best safe dividend stocks today may not be the same tomorrow, it’s important that you remember the key takeaways of how to find the safest dividend-paying stocks.

This includes focusing on companies with stable dividend histories, strong financial health indicators, and resilience in stable sectors. 

Our blog has more resources on topics like how to buy the dip, the best stock research sites, falling stocks to buy, current undervalued stocks, investing after retirement, best stocks to buy for beginners, and more.

But with the best beginner investment app awaiting you at VectorVest, you can say goodbye to any stress or uncertainty of investing today. 

It not only brings you the best opportunities on a daily basis but also tells you when to buy stocks and when to sell stocks, ensuring a comprehensive portfolio management system.

Start leveraging VectorVest today to make informed decisions that empower you to build an income-generating portfolio on autopilot!

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