Best Dividend Stocks to Buy Now for January 2026
5 Best Dividend Stocks to Buy Today
| Company (Ticker) | 12 Week Price Change | Annual Dividend | Annualized Dividend Growth | Dividend Payout Ratio | Dividend Yield |
|---|---|---|---|---|---|
| Copa Holdings (CPA) | 4.19% | $6.44 | 34.23% | 40.00% | 4.94% |
| John Wiley & Sons (WLY) | -15.09% | $1.42 | 0.74% | 37.00% | 4.52% |
| Sonoco (SON) | 16.61% | $2.12 | 4.01% | 36.00% | 4.53% |
| Prudential Financial (PRU) | 18.90% | $5.40 | 3.93% | 38.00% | 4.55% |
| Omnicom Group (OMC) | 2.05% | $3.20 | 0.77% | 33.00% | 4.06% |
*Updated on January 9, 2026.
Copa Holdings (CPA)
$130.31 USD 0.00 (0.00%)
3-Year Stock Price Performance
Premium Research for CPA
- Zacks Rank
- Hold 3
- Style Scores
A Value C Growth C Momentum B VGM
- Market Cap:$5.24 B (Mid Cap)
- Last Announced Dividend Amount: $1.61
- Last Dividend Payout Date:Dec. 15, 2025
- Projected EPS Growth:14.84%
- Next EPS Report Date: Feb. 11, 2026
Our Take:
Copa is a Panama-based airline whose Hub of the Americas connects underserved routes across North, Central, and South America from Panama City. A 737-focused fleet and strict cost control support one of the region’s most efficient networks.
For income, the 5.05% yield, 40% payout, and just 5.59x price-to-cash-flow argue for durable coverage, aided by 26.39% ROE and manageable 0.61 debt-to-equity. Dividend growth of 34.23% over five years and 117.33% historical EPS growth reinforce through-cycle resilience.
Operational trends remain favorable: November traffic rose roughly 10% year over year with an 86% load factor, and management continues a frequency-led expansion plan while keeping capacity aligned to demand.
The stock’s Style Score of A for Value and Zacks Rank #3 (Hold), plus a 5.49% estimated EPS increase this year, indicate a reasonable entry at steady expectations. Together, network economics, disciplined capital, and measured growth make Copa an appealing source of steady, sustainable airline income.
John Wiley & Sons (WLY)
$31.39 USD 0.00 (0.00%)
3-Year Stock Price Performance
Premium Research for WLY
- Zacks Rank
- Hold 3
- Style Scores
B Value F Growth F Momentum D VGM
- Market Cap:$1.60 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 publisher known for academic journals, scientific content platforms, and education services, anchored by Wiley Online Library and society partnerships.
Income appeal rests on a 4.65% yield, a conservative 37% payout, and a low 4.69x price-to-cash-flow, supported by 28.23% ROE.
Fundamentals are improving. Fiscal 2025 delivered significant margin expansion and reaffirmed fiscal 2026 targets, helped by cost actions and AI content-licensing. In Q2 fiscal 2026, adjusted EPS rose 12% and Wiley executed another $6 million AI project, bringing year-to-date AI licensing to $35 million. The company also lifted its dividend for the 32nd consecutive year and increased its fiscal 2026 buyback allocation to $100 million.
With a Value Score of B, Zacks Rank #3, and an estimated 9.89% EPS increase this year versus 2% five-year historical growth, shares look reasonably priced. Combined with a moderate payout and resilient research franchise, positioning supports steady, sustainable dividend income.
Sonoco (SON)
$46.68 USD -0.15 (-0.32%)
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:$4.51 B (Mid Cap)
- Last Announced Dividend Amount:$0.53
- Dividend Payout Date:Dec. 10, 2025
- Projected EPS Growth:34.83%
- Next EPS Report date:Feb. 17, 2026
Our Take:
Sonoco is a diversified packaging manufacturer spanning consumer, industrial, and protective solutions, with deep capabilities in paper-based rigid packaging and metal packaging.
For income investors, the 4.64% yield, 36% payout, and a reasonable 5.66x price-to-cash-flow suggest sturdy coverage. A 20.49% ROE and balanced end-markets further support sustainability through cycles.
Strategy and execution strengthen the case. The Eviosys acquisition built scale in metal cans, contributing to 2025 sales growth, while divestitures of Thermoformed/Flexibles and the sale of ThermoSafe direct proceeds to debt reduction, tightening focus and flexibility. Management is targeting significant productivity savings via automation, robotics, and digital printing, and opened a Global Capability Centre in Hyderabad to expand shared services and digital operations.
With an A Value Score, Zacks Rank #3, 10.17% five-year historical EPS growth, and a 6.24% estimated increase this year, valuation looks appealing at steady expectations for a century-old franchise whose scale and operational upgrades support sustainable cash generation.
Prudential Financial (PRU)
$118.58 USD -0.14 (-0.12%)
3-Year Stock Price Performance
Premium Research for PRU
- Zacks Rank
- Hold 3
- Style Scores
A Value D Growth F Momentum C VGM
- Market Cap:$41.18 B (Large Cap)
- Last Announced Dividend Amount: $1.35
- Last Dividend Payout Date:Dec. 11, 2025
- Projected EPS Growth:14.74%
- Next EPS Report Date:Feb. 3, 2026
Our Take:
Prudential is a diversified insurer with U.S. life, retirement, and annuity operations, anchored by PGIM, its global multi-asset manager with about $1.6 trillion in AUM as of Sep. 30, 2025.
For income, a 4.62% yield, 38% payout, and reasonable 8.37x price-to-cash-flow support dividend durability. Balance-sheet leverage is modest at 0.58 debt-to-equity, alongside 16.61% ROE, which are constructive markers for coverage.
Strategically, Prudential has streamlined governance by placing key units under the CEO and consolidating PGIM’s fixed-income and private-credit capabilities into a nearly $1 trillion platform, aiming to sharpen distribution, scale, and efficiency. These steps complement diversified fee and spread income across insurance and asset management.
A Style Score of A for Value and Zacks Rank #3 indicates a reasonable entry. Combined with prudent leverage, capital strength, and a disciplined dividend payout policy, these drivers support steady and sustainable dividend income for long-term holders today.
Omnicom Group (OMC)
$78.06 USD -0.73 (-0.93%)
3-Year Stock Price Performance
Premium Research for OMC
- Zacks Rank
Hold 3
- Style Scores
A Value D Growth F Momentum C VGM
- Market Cap:$14.97 B (Large Cap)
- Last Announced Dividend Amount:$0.80
- Dividend Payout Date:Jan. 9, 2026
- Projected EPS Growth:6.58%
- Next EPS Report date:Feb. 3, 2026
Our Take:
Omnicom Group is a leading global marketing services company spanning creative, media, PR, and healthcare communications, now enlarged by its November 2025 acquisition of Interpublic. The combination creates the industry’s largest holding company by revenue and broadens scale in data, media, and production.
Income is supported by a 4.12% yield, a disciplined 33% payout, and an 8.27x price-to-cash-flow, reinforced by robust 33.3% ROE and manageable 0.95 leverage.
Integration is underway with targeted streamlining and brand consolidation aimed at unlocking a significant amount in annual cost savings, while a next-generation Omni AI platform made its debut at CES 2026 to unify data and activation across the network. Together, these moves should enhance margin durability and cash generation.
With an A Value Score, Zacks Rank #3, 9.25% five-year historical EPS growth, and a 6.02% estimated increase this year, the valuation looks reasonable. Scale, data, and disciplined capital returns support sustainable dividends through cycles.
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. 8, 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.
