Best Dividend Stocks for Keeping Your Wallet Warm in 2023
Best Dividend Stocks for Keeping Your Wallet Warm in 2023

Best Dividend Stocks for Keeping Your Wallet Warm in 2023

Learn about the benefits and risks of investing in dividend stocks and ETFs that can earn you passive income.

Clement Udoma

Updated Feb 25, 2023

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Dividend stocks are a type of investment that rewards shareholders with regular payouts, called dividends. These dividends are a portion of the company's earnings and are distributed to shareholders on a regular basis. Essentially, it's like getting a bonus just for holding onto a stock.

Investing in a variety of stocks or a diversified high-dividend ETF can reduce your exposure to commodity prices and market fluctuations.

Not all stocks pay dividends, but those that do can be a great choice for income investors. The best dividend stocks offer a reliable stream of income and support continued dividend growth.

Dividend-paying stocks have historically outperformed non-dividend-paying stocks, with dividend-paying stocks in the S&P 500 outperforming non-dividend-paying stocks by an average of 1.9% per year from 1972 to 2019.

But which dividend stocks should you invest in? Well, in this article, we'll talk about the best dividend stocks to invest in and the investments worth considering.

Why are dividend stocks so valuable?

Dividend stocks, which pay out regular dividends to shareholders, can be some of the most reliable dividend stocks and a top choice for conservative investors who value stable cash flow and steady growth.

It's like a marriage that's stood the test of time, dating all the way back to the 17th century. Paying out dividends has been a common practice among publicly traded companies worldwide ever since, and investors seeking a reliable source of passive income just can't get enough.

If you're ready to commit to creating a portfolio of these babies, you'll want to choose companies that pay reliable dividends and diversify across industries and market caps. Think of it as building a harem of reliable and diverse partners.

And for you income investors out there, dividend stocks are like the lovechild of income and growth potential—they offer both a regular source of cash flow that can add up over time and the potential for capital appreciation. It's the best of both worlds.

So, make sure to pick the most reliable dividend stocks with a good track record and the potential for continued dividend growth. Diversify your investments across different industries and market caps, and pay attention to factors like the company's revenue growth, dividend yield, and payout ratio.

Pros and cons of investing in dividend stocks



Low-risk predictable returns


Make money without selling


Compounding returns with dividend reinvestment



Stock price can go down


Dividend yield can fluctuate


Dividends are usually quarterly

Those looking for the cream of the crop dividend aristocrats should check out these companies that have consistently paid out high dividends for half a century or more.

Best dividend stocks of 2023

Investing in dividend stocks can be a great way for income investors to generate a reliable stream of cash flow and potentially grow their wealth over time. When considering dividend stocks to invest in, there are several types to choose from, including blue-chip stocks, dividend growth stocks, high-yield dividend stocks, preferred stocks, and dividend ETFs.

To identify the most reliable dividend stocks, investors must research and consider factors such as dividend yield, payout ratio, dividend growth rate, and the company's financial health. Ultimately, the type of dividend stocks to invest in will depend on the individual investor's risk tolerance and financial goals. So, whether you're a novice or seasoned investor, exploring the world of dividend stocks can be a valuable addition to your investment portfolio.

1. Pioneer Natural Resources Co (PXD)

  • Sector: Energy
  • Dividend Yield: 12.47%

Market Cap: 

Investing in Pioneer Natural Resources Co. is like finding a golden goose that lays delicious dividend eggs. With a price of and a dividend yield of 12.47%, this stock is a contender for best dividend stock of 2023.

According to Zacks, Pioneer Natural Resources is a dividend aristocrat with a coveted A Growth Score—like an A+ on your high school report card. This means the company has strong growth potential and is a reliable choice for conservative income investors looking for reliable dividend stocks.

PXD has a long history of dividend increases and dividend growth rate, so you can trust that the company will support continued dividend growth. Plus, with its steady cash flow and strong balance sheet, you can rest assured that PXD is one of the most reliable dividend stocks out there.

Investing in PXD is like having a dependable friend who always comes through. Whether it's for income or growth, PXD has got you covered. So go ahead, treat yourself to that fancy latte, and invest in PXD for the long haul. Who knows, you might even become one of the patient investors who enjoy the price appreciation of this high-yielding stock.

2. Altria Group Inc (MO)

  • Sector: Health care
  • Dividend Yield: 7.82%

Market Cap: 

Altria Group Inc. is the best of the best when it comes to dividend stocks. This one will cost you per share and has a dividend yield of 7.82%, which is like winning the jackpot in the dividend game. Who needs to smoke when you can light up your portfolio with these sweet, sweet dividends?

Altria Group Inc. isn't just a one-trick pony. They're a diversified tobacco company expanding into new markets like wine and beer, making them a reliable option for those with a lower risk tolerance. With a strong brand portfolio that includes iconic names like Marlboro and Black & Mild, they've got a competitive edge (and a captive consumer base) that keeps them ahead of the game.

Investing in Altria Group Inc. is like investing in a best friend who's got it all together (but smokes a pack a day, to your chagrin). They've got a solid dividend history, a reliable dividend growth rate, and a steady cash flow that supports continued dividend growth. And for all you conservative investors out there, they've even got a conservative payout ratio.

Altria Group Inc. has a track record of nearly half a century of paying higher dividends, and their steady growth is like a breath of fresh air in today's volatile market. Sit back, relax, and take a puff of those sweet dividend returns. Your portfolio will thank you later.

3. Extra Space Storage Inc (EXR)

  • Sector: Real estate
  • Dividend Yield: 3.78%

Market Cap: 

Extra Space Storage Inc is not just an average storage company but it's a real estate investment trust, or REIT, with a current price of . And it's no slouch when it comes to dividends. In fact, it made Forbes' list of best dividend stocks with a solid 3.78% yield.

Extra Storage Space is technically a real estate investment trust, or REIT. That means that, in addition to that juicy annual dividend, investors are entitled to a majority of realty income. EXT is one of the best REITs to invest in because when they sell a property, the earnings go back to investors.

Extra Space Storage Inc has been consistently increasing its dividend for the past 10 years, with a tasty 10.2% annual growth rate over the past five years. That's the kind of dividend history that'll make any income investor drool.

Why should you invest in Extra Space Storage Inc? Well, it has stable earnings and strong industry fundamentals. Plus, with the popularity of the KonMari method and tiny homes, people are learning to declutter, but they'll always need a place to stash their stuff. And with a solid dividend track record, you can support continued dividend growth while earning a little extra cash.

4. V.F. Corporation (VFC)

  • Sector: Consumer discretionary
  • Dividend Yield: 4.45%

Market Cap: 

V.F. Corporation is one of the best dividend stocks out there. A share in this company costs and has a history dating back to 1899—and it pays out dividends like it's nobody's business. With a dividend yield of 4.45%, it's been raising those dividends for nearly half a century. That's longer than most of us have been alive, right?

But here's the thing that really sets V.F. Corporation apart: they're not putting all their eggs in one basket. They've got a diverse portfolio of brands, so they're not just relying on one product to keep the money flowing. Have you heard of The North Face or Vans? Those are just a couple of their big hitters.

For all you income investors out there, this company is a reliable dividend stock with a solid dividend track record. They're even considered a dividend aristocrat with consecutive dividend increases to support continued dividend growth. Plus, with their strong financial position, steady cash flow, and predictable cash flow, you can trust that they'll keep paying out those sweet dividends.

If you're looking for a company with a history of steady growth and an average dividend yield, V.F. Corporation is a great choice for conservative investors with a low risk tolerance. With their natural gas liquids and fossil fuels, they're not just keeping up with the broader market, they're leading the pack. And with a payout ratio that's well within the conservative range, you can trust that they'll keep the dividends coming.

5. Devon Energy Corporation (DVN)

  • Sector: Energy
  • Dividend Yield: 8.19%

Market Cap: 

Devon Energy Corporation is one of the best dividend stocks out there for 2023. This company has been around for nearly half a century—since 1971 to be exact. With a share price of , they're a big player in the fossil fuels game.

But, what really sets them apart from the rest is their massive dividend yield. At 8.19%, it's higher than a giraffe's neck and most other energy companies out there.

Why is Devon Energy Corporation such a great option for income investors looking for reliable dividend stocks? Well, this company has a solid track record of supporting continued dividend growth. They're committed to returning value to their shareholders through smart investments that support steady cash flow and natural gas liquids. And let's not forget their nearly half a century of dividend history.

Devon Energy Corporation is a company that pays dividends like clockwork. Their high dividend yield is the cherry on top of an already delicious sundae. Just make sure to do your research and consider your risk tolerance before investing. But hey, with a credit rating as good as theirs, you can rest easy.

6. AT&T Inc (T)

  • Sector: Consumer discretionary
  • Dividend Yield: 5.71%

Market Cap: 

AT&T Inc is one of the best dividend stocks out there. With a generous dividend yield of 5.71%, you can sit back, relax, and watch the cash roll in.

But don't worry, this isn't some sketchy operation. AT&T Inc has been around since 1885 and has a long track record of paying dividends. In fact, they're one of the most reliable dividend stocks out there. You can trust that they'll continue to support their continued dividend growth for years to come.

So if you're an income-seeking investor with a taste for excitement, AT&T Inc is the perfect addition to your portfolio. With its history, market cap, and impressive dividend yield, it's a no-brainer. It's like having a money tree in your portfolio, without all the fuss of watering and pruning. Don't miss out on this opportunity to make some serious cash.

7. Philip Morris International Inc (PM)

  • Sector: Health care
  • Dividend Yield: 4.99%

Market Cap: 

Have you checked out Philip Morris International Inc lately? Yeah, we know what you're thinking—a tobacco company in the health care sector? While their share price has moved a dismal this year, it’s shaping up to be a good opportunity to buy this for their killer dividend yield of almost 5%.

That's right, PMI knows how to pay those dividends like it's their job (because it is). And they've been doing it for a while now, with a history of increasing those payouts year after year.

Everyone knows smoking is bad for you, but let's ignore that for second. PMI is a global player with a footprint in over 180 countries, and they're damn good at what they do. Their stability in the cigarette market means a steady stream of revenue, which means they can support continued dividend growth for their shareholders.

So, if you're a fan of dividend paying stocks or consider yourself an income investor, give PMI a try. They aren’t the cure for cancer, but their highly addictive products are sure to make investors happy. Who doesn't love a reliable dividend stock with a solid track record of consecutive dividend increases?

PMI is like the dividend aristocrat of the tobacco world with nearly a half-century history of dividend growth. So go ahead and light up some profits with PM.

8. Dow Inc. (DOW)

  • Sector: Industrials
  • Dividend Yield: 4.82%

Market Cap: 

Dow Inc. (DOW)—not to be confused with the Dow Jones Industrial Average—this is a company that goes for a share. And if you're all about that dividend yield, you'll be pleased to know that DOW's yield is a hefty 4.82%. That's some serious cheddar for your investment portfolio.

But that's not all—one of the coolest things about Dow Inc. is its long-standing history of paying dividends and increasing them. They're like that trusty friend who always comes through for you. And with a presence in over 160 countries, DOW has a stable source of revenue that supports its ability to pay dividends. They're like that friend who always has your back—financially speaking.

And if you're a socially conscious investor, DOW might just be the perfect match for you. Their portfolio includes products and technologies that contribute to sustainable solutions. They're like the superhero who saves the planet while earning you some dough.

Oh, and did we mention that Dow Inc. is committed to returning value to shareholders by repurchasing shares of its common stock? They're like the smart friend who knows how to make the most out of their investment.

All in all, Dow Inc.'s strong financial position, commitment to sustainability, and history of paying and increasing dividends make it an attractive option for income investors. So if you're looking for a company that's financially stable and socially responsible, DOW is definitely worth considering. And with a dividend yield like that, you might just be able to treat yourself to some natural gas liquids or even a real estate investment trust.

Are dividend stocks a good investment?

Investing in dividend stocks can provide a reliable source of income for conservative investors, especially those seeking steady cash flow. The best dividend stocks are often established companies with a strong track record of paying dividends and a good reputation among dividend aristocrats.

These companies have consistently paid dividends for nearly half a century or longer and have the financial strength to support continued dividend growth. When selecting dividend-paying stocks, it's important to consider the company's dividend history, payout ratio, and cash flow, as well as its ability to pay dividends and support dividend growth.

Some of the most reliable dividend stocks are those with a high dividend yield and a solid dividend growth rate, such as Realty Income and Enterprise Products Partners. These companies have a stable cash flow and a strong balance sheet, which supports their ability to pay dividends and increase them annually. Additionally, these stocks tend to have a conservative payout ratio, which means they have room to increase the dividend amount in the future.

While dividend-paying stocks can be a tax-advantaged way to earn income, they also come with risks, such as the potential for a company to reduce or stop dividend payments, or for the stock price to decline.

To mitigate these risks, it's important to diversify your portfolio with a mix of dividend-paying and non-dividend-paying stocks, as well as other types of assets, such as natural gas, oil, or transportation companies. Investing in a variety of stocks or a diversified high-dividend ETF can reduce your exposure to commodity prices and market fluctuations.

Overall, dividend stocks can be a valuable addition to an income investor's portfolio, providing a reliable source of income and potential for price appreciation. By selecting the best dividend stocks with a strong dividend track record, solid growth rate, and patient investors can achieve their financial goals over the long term.

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