Best Dividend Stocks to Buy Now for October 2025
5 Best Dividend Stocks to Buy Today
| Company (Ticker) | 12 Week Price Change | Annual Dividend | Annualized Dividend Growth | Dividend Payout Ratio | Dividend Yield |
|---|---|---|---|---|---|
| Columbia Banking System (COLB) | 7.22% | $1.44 | 7.05% | 51.00% | 5.51% |
| Prudential Financial (PRU) | -2.11% | $5.40 | 4.17% | 41.00% | 5.24% |
| Euroseas (ESEA) | 10.67% | $2.80 | 11.65% | 17.00% | 4.96% |
| Host Hotels & Resorts (HST) | -0.18% | $0.80 | 47.73% | 40.00% | 4.83% |
| The Bank of N.T. Butterfield & Son Limited (NTB) | -7.27% | $2.00 | 0.73% | 35.00% | 4.76% |
*Updated on October 17, 2025.
Stock #1
Columbia Banking System (COLB)
$24.07 USD -2.07 (-7.92%)
3-Year Stock Price Performance
Premium Research for COLB
- Zacks Rank
Hold 3
- Style Scores
B Value D Growth A Momentum B VGM
- Market Cap:$5.50B (Mid Cap)
- Last Announced Dividend Amount:$0.36
- Last Dividend Payout Date:Sept. 15, 2025
- Projected EPS Growth:5.17%
- Next EPS Report date:Oct. 30, 2025
Our Take:
Columbia is a West Coast regional bank whose 2023 merger with Umpqua created a $50 billion-asset franchise with broad deposit reach across eight western states. Recently, it expanded further with the acquisition of Pacific Premier Bancorp, deepening scale in attractive Western markets.
For income-oriented investors, the 5.5% dividend yield, a balanced 51% payout, and a Value Score of B argue for steady, reasonably priced cash returns. The bank trades at a single-digit price-to-cash-flow ratio, and its dividend has grown at mid-single-digit rates over the past five years. These are useful signals of affordability and coverage through cycles.
Strategically, larger scale and announced cost synergies from recent deals, plus strong community banking franchises, should support normalized earnings and dividend capacity as funding pressures ease. Recent results show resilient profitability as the company integrates operations. The combination of a prudent payout policy, consolidation benefits, and a favorable Value Score supports a sustainable income thesis.
Stock #2
Prudential Financial (PRU)
$99.85 USD -3.28 (-3.18%)
3-Year Stock Price Performance
Premium Research for PRU
- Zacks Rank
- Hold 3
- Style Scores
B Value F Growth D Momentum D VGM
- Market Cap:$36.30B (Large Cap)
- Last Announced Dividend Amount: $1.35
- Last Dividend Payout Date:Sept. 11, 2025
- Projected EPS Growth:8.87%
- Next EPS Report Date:Oct. 29, 2025
Our Take:
Prudential is a diversified U.S. insurer with leading positions in life, annuities, and retirement, complemented by PGIM, its $1.5 trillion multi-asset investment manager serving institutional and retail clients worldwide. This business mix creates fee and spread income streams that strengthen cash generation through cycles.
Income seekers get a 5.2% yield supported by a 41% payout ratio and a Value Score of B, indicating a reasonable entry point. The company has maintained a disciplined dividend program, most recently declaring a $1.35 quarterly distribution, consistent with its focus on returning capital while investing for growth.
Beyond income, PGIM’s scale and diversified U.S. protection and retirement franchises provide resiliency as rates and equity markets fluctuate. Recent updates highlight solid sales momentum and investment performance, reinforcing confidence that earnings can sustain the dividend. With valuation support, multiple profit drivers, and mid-teens ROE, PRU offers a balanced path to steady, sustainable income.
Stock #3
Euroseas (ESEA)
$55.55 USD -0.88 (-1.56%)
3-Year Stock Price Performance
Premium Research for ESEA
- Zacks Rank
- Hold 3
- Style Scores
A Value D Growth C Momentum B VGM
- Market Cap:$395.38M (Small Cap)
- Last Announced Dividend Amount:$0.70
- Last Dividend Payout Date:Sept. 16, 2025
- Projected EPS Growth:12.17%
- Next EPS Report date:Nov. 19, 2025
Our Take:
Euroseas owns and operates a modern fleet of feeder and intermediate containerships, chartered to global liners under multi-year contracts. Management has been locking in coverage at attractive rates and adding fuel-efficient newbuilds to lower unit costs and emissions.
The stock’s near-5% yield, low 17% payout, and a Value Score of A offer rare income headroom in shipping. Five-year dividend growth has been double-digit, and recent updates show rising contracted EBITDA and charter coverage reaching 100% for the rest of 2025 and 70% for 2026, offering visibility for sustaining distributions across freight cycles.
Fundamentally, Euroseas’ disciplined capital allocation, with the selling of older vessels, adding efficient ships, and terming out charters, supports cash flows even as spot rates fluctuate. Its recent results and fleet actions underscore balance-sheet flexibility and earnings power that back the dividend, while the favorable Value Score points to a reasonable entry for self-funded income.
Stock #4
Host Hotels & Resorts (HST)
$16.19 USD -0.38 (-2.29%)
3-Year Stock Price Performance
Premium Research for HST
- Zacks Rank
- Hold 3
- Style Scores
A Value C Growth D Momentum B VGM
- Market Cap: $11.39B (Large Cap)
- Last Announced Dividend Amount: $0.20
- Last Dividend Payout Date:Oct. 15, 2025
- Projected EPS Growth:1.02%
- Next EPS Report Date: Nov. 5, 2025
Our Take:
Host is the largest U.S. lodging REIT, owning a geographically diverse portfolio of luxury and upper-upscale hotels primarily under Marriott and Hyatt brands. The company’s strategy focuses on owning premier assets, disciplined reinvestment, and maintaining a strong balance sheet.
The 4.83% yield, conservative 40% payout, and a Value Score of A suggest an appealing entry for durable REIT income. Management underscores an investment-grade balance sheet and ample liquidity, supporting dividends and selective reinvestment across lodging cycles.
Recent updates highlight continued capital returns and a robust liquidity position, with credit facility capacity providing flexibility for renovations and opportunistic transactions. As group and leisure demand normalizes, Host’s scale and brand affiliations should sustain cash flows that comfortably fund its dividend. For income investors seeking real-asset exposure, valuation support, and financial resilience, HST is a credible, sustainable payer.
Stock #5
The Bank of N.T. Butterfield & Son Limited (NTB)
$41.01 USD -0.97 (-2.31%)
3-Year Stock Price Performance
Premium Research for NTB
- Zacks Rank
Strong Buy 1
- Style Scores
C Value F Growth A Momentum D VGM
- Market Cap:$2.00B (Mid Cap)
- Last Announced Dividend Amount: $0.50
- Last Dividend Payout Date:Aug. 25, 2025
- Projected EPS Growth:10.06%
- Next EPS Report Date:Oct. 28, 2025
Our Take:
The Bank of N.T. Butterfield is a Bermuda-based bank and wealth manager with operations across Bermuda, the Cayman Islands, the Channel Islands, and the UK.
Its income appeal comes from a 4.8% yield with a conservative 35% payout and a reasonable 7.6× cash-flow multiple. Its offshore deposit base, fee-rich trust and wealth businesses, and conservative credit culture support durable, low-capital-intensity earnings that fund dividends.
Operational efficiency initiatives and disciplined capital returns, including dividend increases and opportunistic buybacks, further reinforce coverage and signal confidence in recurring cash generation.
Its Zacks Rank #1 (Strong Buy) signals positive estimate momentum. Combined with a measured payout and stable niche markets, it underpins confidence in steady and sustainable income for long-term investors.
Methodology
The Zacks Rank is a proprietary stock-rating model that uses trends in earnings estimate revisions and earnings-per-share (EPS) surprises to classify stocks into five groups: #1 (Strong Buy), #2 (Buy), #3 (Hold), #4 (Sell) and #5 (Strong Sell). The Zacks Rank is calculated through four primary factors related to earnings estimates: analysts' consensus on earnings estimate revisions, the magnitude of revision change, the upside potential and estimate surprise (or the degree in which earnings per share deviated from the previous quarter).
Zacks builds the data from 3,000 analysts at over 150 different brokerage firms. The average yearly gain for Zacks Rank #1 (Strong Buy) stocks is +23.62% per year from January, 1988, through June 2, 2025.
For this list, only companies trading on the New York Stock Exchange or NASDAQ with a dividend yield of 4 to 6% were included. We also only evaluated stock with a low debt-to-equity ratio, as well as a conservative payout ratio and dividend growth. Only stocks with a Zacks Rank #3 (Hold) or higher were considered. All information is current as of market open, Oct. 16, 2025.
Guide to Best Dividend Stocks
What Are Dividend Stocks?
Dividend stocks are shares of companies that return a portion of their earnings to shareholders on a regular basis. Rather than relying solely on stock price appreciation, dividend investors benefit from this income stream, which can complement long-term growth.
How Do Dividend Stocks Work?
Corporations that generate surplus cash may decide to share part of it with shareholders through dividends. The firm’s board will declare a dividend — often expressed as a dollar amount per share — and set a record date to identify eligible shareholders. On the payment date, the company sends the dividend (in cash or additional shares) to investors who held the stock on the record date.
Dividends typically come out of a company’s profits or free cash flow. To continue paying dividends, companies need consistent earnings, prudent capital allocation, and manageable debt levels.
How Often Do Dividend Stocks Pay in a Year?
Most U.S. dividend-paying companies distribute dividends quarterly (four times per year). Some firms choose semiannual or annual payments, depending on business norms or cash flow timing. What matters more than the frequency is consistency — companies that maintain or increase their dividend over time tend to instill more investor confidence.
Benefits and Risks of Dividend Stocks
Benefits:
- Supplemental income stream — Dividends provide cash flow even if the stock price is flat or in decline.
- Total return boost — Over long horizons, dividends have historically contributed a meaningful share of returns. (Many capital markets analyses show dividends often account for 30–50% of total equity returns.)
- Downside cushion — In volatile markets, dividend income helps offset capital losses.
- Sign of stability — Companies that consistently pay or increase dividends often have disciplined management and stable cash flows.
Risks:
- Dividend cuts — If a company hits a rough patch, it might reduce or suspend dividends, which often leads to share price declines.
- Limited growth reinvestment — High dividend payments may reduce funds available for expansion or innovation.
- Interest rate competition — When bond yields rise, dividend stocks (especially those with modest growth prospects) may look less attractive in comparison.
- Tax drag — Dividends are taxed (depending on account structure and holding period), which can eat into net return.
Dividend Stock ETFs vs Individual Stocks
When considering dividend exposure, investors have two main paths:
- Individual dividend stocks: You pick specific companies you trust to pay and grow dividends. This gives you direct control over stocks and allows targeted allocation to sectors or themes you favor.
- Dividend ETFs / mutual funds: Pools of dividend-paying stocks maintained by professional managers. These provide instant diversification, reduce individual stock risk, and simplify portfolio management.
Pros of Dividend ETFs
- Automatic diversification lowers the risk of a single holding failing.
- Fund managers monitor holdings and rebalance.
- Easier to scale and maintain, especially for smaller portfolios.
Cons of Dividend ETFs vs Individual Stocks
- Yields tend to be diluted by including lower-yielding names.
- Less control over specific holdings or sector weightings.
- Management fees may erode yields over time.
Many investors use a hybrid strategy: core allocation via a dividend ETF (for stability) supplemented by hand-picked individual dividend stocks for yield or growth.
How to Choose the Best Dividend Stocks
Not all dividend stocks are created equal. Here’s what to look for when evaluating candidates:
Dividend Yield
Yield = (Annual Dividend per Share) ÷ (Current Share Price). A moderate, well-supported yield (say 2 %–6 %, depending on sector) can be healthy, while extremely high yields often signal trouble (e.g. deep decline in share price)
Dividend Payout Ratio
This ratio shows what percentage of a company’s earnings are paid out as dividends. If a company distributes too much (e.g. > 80–90 %), it may lack flexibility to weather downturns. More conservative ratios (e.g. 30–60 %) often indicate room for future increases or a buffer in tough times.
Dividend Growth History
Look for firms that have steadily raised their dividends over years. A consistent upward trend signals confidence in future earnings. Dividend “Aristocrats” — firms in the S&P 500 that have raised dividends for at least 25 consecutive years — are often viewed as safer dividend picks.
Company Financial Health
Examine fundamentals:
- Free cash flow and cash flow stability
- Debt load and interest coverage
- Profit margins
- Growth prospects
- Competitive advantage (moat)
A company with healthy cash flow and manageable debt is more likely to sustain and grow dividends.
Sector and Market Trends
Some sectors are inherently more dividend-friendly (utilities, consumer staples, real estate, energy) because they generate steady cash flows. Others (like high-growth tech) may pay little to none in dividends as they reinvest heavily.
Also consider macro conditions — for example, rising interest rates, inflation pressures, regulatory risks — which may disproportionately affect certain sectors.
Tips for Building a Dividend Portfolio
- Start with a foundation of blue-chip dividend stocks — Established companies with strong balance sheets and long payout histories.
- Diversify across sectors — Avoid being overly concentrated in one industry (e.g. energy or REITs).
- Reinvest dividends — Using a Dividend Reinvestment Plan (DRIP) can compound returns over time.
- Allocate some portion to growth or higher-yield names, if your risk tolerance allows — but don’t let them dominate.
- Review and rebalance periodically — Monitor fundamentals, payout changes, valuation shifts, and sector dynamics.
- Use metrics and screening tools — Apply filters (yield, payout ratios, growth, fundamentals) to narrow your universe, then do deeper research.
Mistakes to Avoid about Dividend Stocks
- Chasing the highest yield blindly — extremely high yields can indicate a distressed company or impending cuts.
- Ignoring payout sustainability — yield without coverage (earnings, cash flow) is precarious.
- Overconcentration in one stock or sector — a dividend cut or sector downturn can deeply hurt.
- Neglecting growth potential — pure high-yield stocks may underperform in growth cycles.
- Forgetting taxes and fees — dividends taxed or fees eroding yield can reduce net returns.
Also, be cautious if yield spikes because of falling share price — that could be a warning sign rather than opportunity.
Frequently Asked Questions About Dividend Stocks
How are dividends taxed?
In the U.S., qualified dividends (if holding periods are met) are taxed at long-term capital gains rates (0 %, 15 %, or 20 %, depending on income bracket). Non-qualified dividends are taxed at ordinary income rates. Additionally, when you sell shares, capital gains taxes may apply to the appreciation portion.
Are dividend stocks good for retirees?
Yes. They can provide a predictable stream of income and may buffer volatility. However, retirees should emphasize safety and sustainability — favor those with strong balance sheets, stable business models, and moderate payout ratios. Also, be aware of tax effects and inflation.
What’s a good dividend yield?
There’s no one “ideal” yield. Many investors view 2 %–6 % as reasonable, depending on the sector and interest rate environment. Yields well above that range warrant extra scrutiny — high yields often come with higher risk.
Are dividend stocks safe for beginners?
They can be, especially when you start with well-known, financially sound dividend payers and diversify. The income cushion helps offset downside risk. But beginners must still research fundamentals, avoid yield traps, and avoid overconcentration.
