Best Dividend Stocks to Buy Now for December 2025
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) | 5.76% | $6.44 | 59.43% | 40.00% | 5.19% |
| Prudential Financial (PRU) | 12.05% | $5.40 | 4.17% | 38.00% | 4.70% |
| TIM (TIMB) | -3.15% | $0.95 | 10.47% | 55.00% | 4.61% |
| Petroleo Brasileiro (PBR) | -10.37% | $0.53 | 31.65% | 40.00% | 4.50% |
| Host Hotels & Resorts (HST) | 6.87% | $0.80 | 47.73% | 40.00% | 4.32% |
*Updated on December 20, 2025.
Copa Holdings (CPA)
$124.12 USD +4.16 (3.47%)
3-Year Stock Price Performance
Premium Research for CPA
- Zacks Rank
- Hold 3
- Style Scores
A Value C Growth A Momentum A VGM
- Market Cap:$4.87 B (Mid Cap)
- Last Announced Dividend Amount: $1.61
- Dividend Payout Date:Dec. 15, 2025
- Projected EPS Growth:14.97%
- Next EPS Report Date: Feb. 11, 2026
Our Take:
Copa is a Panama-based airline that connects North, Central, and South America through its Hub of the Americas at Tocumen International Airport. Its model emphasizes tight operations, leading on-time performance and a disciplined network.
For income, a 5.44% dividend yield, 40% payout, and a low 5.19x price-to-cash-flow suggest solid coverage from cash generation. Modest leverage and a 26.4% ROE reinforce durability, while five-year dividend growth above 50% adds confidence that distributions can keep compounding through cycles.
Fundamentally, Copa’s hub-and-spoke scale and cost discipline support margins and free cash flow, with fleet and route investments aimed at deepening connectivity across the Americas. Recent updates highlight the continued strengthening of the Panama hub to support growth.
An A Value Score points to a reasonable entry, and a Zacks Rank #3 (Hold) aligns with a steady, through-the-cycle dividend profile, appealing to investors prioritizing sustainable income with disciplined capital allocation.
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Prudential Financial (PRU)
$114.99 USD -0.56 (-0.48%)
3-Year Stock Price Performance
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- Zacks Rank
- Hold 3
- Style Scores
A Value D Growth C Momentum B VGM
- Market Cap:$40.49 B (Large Cap)
- Last Announced Dividend Amount: $1.35
- Dividend Payout Date:Dec. 11, 2025
- Projected EPS Growth:14.66%
- Next EPS Report Date:Feb. 3, 2026
Our Take:
Prudential operates as a diversified insurer and retirement solutions provider, supported by PGIM, its global asset management arm with broad capabilities across public and private markets.
A 4.67% yield with a conservative 38% payout and single-digit cash-flow multiple offers attractive coverage while management continues to streamline operations. A healthy 16.6% ROE and expected EPS growth of 14.7% this year support the stability of the dividend.
Beyond income, the firm’s breadth, life, annuities, retirement, and a large third-party asset-management arm diversifies fee and spread earnings. PGIM’s consolidation of credit platforms underscores scale advantages in alternatives and fixed income, which serve as potential stabilizers for cash flows across rate regimes.
With a Value Score of A and Zacks Rank #3, PRU screens as a reasonably priced, durable payer. A diversified earnings base combined with a disciplined payout strategy supports stable, reliable income generation and long-term sustainability for investors.
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TIM (TIMB)
$20.62 USD +0.07 (0.34%)
3-Year Stock Price Performance
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- Zacks Rank
Strong Buy 1
- Style Scores
A Value C Growth C Momentum A VGM
- Market Cap:$10.02 B (Large Cap)
- Last Announced Dividend Amount:$0.15
- Dividend Payout Date:Jan. 28, 2026
- Projected EPS Growth:28.93%
- Next EPS Report Date:Feb. 10, 2026
Our Take:
TIM is one of Brazil’s top national mobile operators, with a fast-growing 5G footprint and recognized network quality leadership. Management now highlights coverage in roughly 1,000 cities following ongoing modernization initiatives, signaling durable scale advantages.
For income, a 4.59% yield sits on a disciplined 55% payout and five-year dividend growth of more than 10%. Modest leverage and an inexpensive cash-flow multiple argue that dividends are well covered by operations, with room for gradual growth.
Strategically, TIM continues to deepen capacity and reach. A multiyear agreement with Nokia to expand 5G supports throughput and enterprise use cases, while its extended partnership with IHS/Towerco to deploy up to 3,000 additional sites leverages an asset-light model. These moves reinforce competitive positioning and cash generation.
A Zacks Rank #1 (Strong Buy) and an A Value Score point to positive estimate momentum and a reasonable entry price, useful confirmations for investors seeking steady, sustainable dividend income.
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Petroleo Brasileiro (PBR)
$11.75 USD +0.03 (0.26%)
3-Year Stock Price Performance
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- Zacks Rank
- Hold 3
- Style Scores
A Value C Growth B Momentum A VGM
- Market Cap:$75.85 B (Large Cap)
- Last Announced Dividend Amount:$0.17
- Dividend Payout Date:March 27, 2026
- Projected EPS Growth:6.38%
- Next EPS Report date:Feb. 25, 2026
Our Take:
Petrobras is Brazil’s state-controlled integrated oil company anchored by prolific pre-salt assets, with scale in exploration, production, refining, and logistics.
Its income appeal starts with a 4.49% dividend yield, a restrained 40% payout, and a very low cash-flow multiple that collectively point to ample coverage. Strong ROE of 23.3% and healthy leverage metrics add comfort, while five-year dividend growth underscores the cash engine of its upstream portfolio.
Strategically, Petrobras continues to prioritize core pre-salt development and disciplined capex, while resetting dividend policy to reflect a lower oil price deck, which is supportive of sustaining ordinary distributions through cycles even as it trims extraordinary payouts.
With an A Value Score and a Zacks Rank #3, the Petrobras screens as a value-oriented income option. For investors comfortable with state-owner oversight and commodity cycles, Petrobras offers a measured, sustainable dividend supported by world-class reservoirs.
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Host Hotels & Resorts (HST)
$18.51 USD +0.05 (0.27%)
3-Year Stock Price Performance
Premium Research for HST
- Zacks Rank
- Buy 2
- Style Scores
B Value D Growth F Momentum D VGM
- Market Cap: $12.77 B (Large Cap)
- Last Announced Dividend Amount: $0.35
- Last Dividend Payout Date:Jan. 15, 2026
- Projected EPS Growth: 4.06%
- Next EPS Report Date: Feb. 18, 2026
Our Take:
Host is the world’s largest publicly traded lodging REIT, owning a diversified portfolio of luxury and upper-upscale hotels across key U.S. markets, including properties with top brands like Marriott and Hyatt.
For income, a 4.31% dividend yield, 40% payout, and a reasonable cash-flow multiple point to well-covered distributions. Balance-sheet discipline and a diversified, high-quality portfolio support through-cycle cash generation, with double-digit five-year dividend growth and strong historical EPS expansion underpinning resilience.
Fundamentally, scale in top U.S. urban and resort markets, brand partnerships, and active asset management give Host levers on RevPAR, mix, and capital recycling, drivers that can sustain funds-from-operations and dividends across demand swings.
An A Value Score and Zacks Rank #2 (Buy) combine an attractive entry with favorable estimate trends. That alignment, plus conservative payout practices, makes HST a credible pick for steady, sustainable REIT income.
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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, Dec. 18, 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.
