Best Dividend Stocks to Buy Now for February 2026
5 Best Dividend Stocks to Buy Today
| Company (Ticker) | 12 Week Price Change | Annual Dividend | Annualized Dividend Growth | Dividend Payout Ratio | Dividend Yield |
|---|---|---|---|---|---|
| TIM (TIMB) | 1.75% | $1.41 | 18.22% | 55.00% | 6.05% |
| Prudential Financial (PRU) | 4.53% | $5.40 | 3.93% | 38.00% | 4.86% |
| John Wiley & Sons (WLY) | -14.51% | $1.42 | 0.74% | 37.00% | 4.55% |
| Sonoco (SON) | 17.99% | $2.12 | 4.01% | 36.00% | 4.42% |
| Lincoln National (LNC) | 1.12% | $1.80 | 1.34% | 23.00% | 4.33% |
*Updated on February 2, 2026.
TIM (TIMB)
$23.50 USD +0.20 (0.86%)
3-Year Stock Price Performance
Premium Research for TIMB
- Zacks Rank
Buy 2
- Style Scores
A Value B Growth C Momentum A VGM
- Market Cap:$11.70 B (Large Cap)
- Last Announced Dividend Amount:$0.64
- Dividend Payout Date:Jan. 7, 2026
- Projected EPS Growth:28.93%
- Next EPS Report date:Feb. 10, 2026
Our Take:
TIM operates one of Brazil’s largest wireless and broadband franchises, with a nationwide 4G and an expanding 5G footprint. A multi-year RAN deal with Nokia to modernize coverage from 2025 supports service quality and a higher-ARPU mix in a concentrated market, reinforcing cash-flow durability.
Its income appeal rests on a 5.83% dividend yield with a measured 55% payout and five-year dividend growth exceeding 18%, paired with modest leverage (debt/equity 0.55) and attractive valuation at 6.2x price/cash flow. An A Value Score and Zacks Rank #2 (Buy) indicate a reasonable entry with positive estimate momentum, useful markers when targeting steady, sustainable distributions.
Cash-flow visibility has improved. In January 2026, TIM consolidated roughly 9,000 towers, about 30% of its sites, into a single American Tower framework running to 2034, enhancing lease efficiency and cost predictability. The I-Systems fiber venture with IHS extends reach while limiting capital intensity, and the latest results showed service revenue and EBITDA growth, supportive of dividend coverage.
Prudential Financial (PRU)
$111.74 USD +0.63 (0.57%)
3-Year Stock Price Performance
Premium Research for PRU
- Zacks Rank
- Hold 3
- Style Scores
A Value D Growth B Momentum B VGM
- Market Cap:$37.69 B (Large Cap)
- Last Announced Dividend Amount: $1.35
- Dividend Payout Date:Dec. 11, 2025
- Projected EPS Growth:14.98%
- Next EPS Report Date:Feb. 3, 2026
Our Take:
Prudential Financial is a diversified insurer and retirement solutions provider with a global footprint and a scaled asset management arm, PGIM, which oversees approximately $1.5 trillion in assets for institutions and individuals. The mix of protection, retirement, and fee-based asset management creates multiple, complementary earnings streams.
A 5.01% yield paired with a conservative 38% payout offers solid coverage, while 7.71x price-to-cash-flow keeps the entry point reasonable. Profitability remains healthy with 16.61% ROE, and leverage looks measured at 0.58 debt-to-equity. Dividend growth has been steady over time (3.93% five-year), consistent with a prudently managed balance sheet.
Earnings cadence is more muted, but the combination of diversified fee and spread businesses and a modest payout gives flexibility to sustain and gradually expand distributions through cycles. An A Value Score underscores attractive valuation support, which is key for long-term income buyers seeking quality at a sensible price. Those characteristics, rather than aggressive growth assumptions, anchor the case for reliable income from PRU.
John Wiley & Sons (WLY)
$31.44 USD +0.21 (0.67%)
3-Year Stock Price Performance
Premium Research for WLY
- Zacks Rank
- Hold 3
- Style Scores
B Value F Growth B Momentum C VGM
- Market Cap:$1.65 B (Small Cap)
- Last Announced Dividend Amount:$0.36
- Dividend Payout Date:Jan. 15, 2026
- Projected EPS Growth:9.89%
- Next EPS Report date:March 5, 2026
Our Take:
Wiley is a global research and learning company whose journals, platforms, and courseware serve scientists, institutions, and professionals worldwide. Wiley streamlined its portfolio (exiting University Services) and leaned into high-margin research publishing, AI content licensing, and cost reductions.
The dividend case rests on a 4.53% yield with a restrained 37% payout and a compelling 4.81x price-to-cash-flow, indicating ample coverage from ongoing operations. ROE is strong at 28.23%, and leverage, while higher than peers, remains manageable under a conservative payout framework.
Five-year dividend growth has been modest, but estimated EPS growth of 9.89% suggests improving earnings support for the distribution. The combination of attractive cash valuation and disciplined capital returns provides a margin of safety as the portfolio remains focused on core, recurring-revenue content. A B Value Score reinforces that investors are paying a reasonable price for resilient cash flows. That valuation cushion, together with prudent payout levels, supports a steady and sustainable dividend profile through industry transitions.
Sonoco (SON)
$48.34 USD +0.34 (0.71%)
3-Year Stock Price Performance
Premium Research for SON
- Zacks Rank
Hold 3
- Style Scores
A Value D Growth B Momentum B VGM
- Market Cap:$4.68 B (Mid Cap)
- Last Announced Dividend Amount:$0.53
- Dividend Payout Date:Dec. 10, 2025
- Projected EPS Growth:34.60%
- Next EPS Report date:Feb. 16, 2026
Our Take:
Sonoco Products is a global packaging manufacturer supplying across consumer and industrial markets. Strategically, portfolio reshaping has improved resilience. The ThermoSafe divestiture simplifies the mix and strengthens the balance sheet, while the Eviosys acquisition built scale in metal cans, contributing to 2025 sales growth.
For income, the 4.47% yield, conservative 36% payout, and 5.87x price-to-cash-flow point to comfortable coverage. Profitability is solid with 20.49% ROE, and leverage at 1.14 debt-to-equity is balanced by a diversified product mix. Dividend growth of 4.01% over five years aligns with a steady, through-cycle approach.
Earnings trajectories, 10.17% five-year historical EPS growth, and 5.77% estimated this year, indicate durable fundamentals that can fund reinvestment while supporting distributions. Exposure to everyday consumer categories helps smooth cash generation across economic environments. An A Value Score signals an attractive entry, complementing the stock’s measured payout and cash-flow support. These elements combine to make SON a credible choice for sustainable dividend income.
Lincoln National (LNC)
$42.42 USD +0.81 (1.95%)
3-Year Stock Price Performance
Premium Research for LNC
- Zacks Rank
- Hold 3
- Style Scores
C Value F Growth F Momentum F VGM
- Market Cap:$7.77 B (Mid Cap)
- Last Dividend Payout Date:$0.45
- Dividend Payout Date:Feb. 2, 2026
- Projected EPS Growth:11.46%
- Next EPS Report date:Feb. 12, 2026
Our Take:
Lincoln National is a diversified insurer offering annuities, life insurance, group protection, and retirement plan services, giving it multiple fee and spread-income streams across economic cycles. Fundamentally, momentum in annuities, record account balances, and double-digit sales with higher spread income help underpin cash generation, while life insurance results benefit from stable mortality and lower expenses.
A 4.40% yield with a notably low 23% payout provides a conservative base for income. Valuation is appealing at 5.31x price-to-cash-flow, and fundamentals are supported by 18.77% ROE with a manageable 0.61 debt-to-equity. While five-year dividend growth has been modest at 1.34%, coverage strength leaves room for gradual increases as earnings normalize.
Historical EPS growth of 4.49% and a positive, albeit lower, current-year estimate of 1.59% frame expectations realistically. The combination of low payout, reasonable leverage, and cash-flow efficiency helps insulate the dividend across market cycles. For income investors, the appeal rests on disciplined capital management and a valuation that compensates for measured growth, supporting a steady and sustainable payout profile.
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, Jan. 29, 2026.
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.
