Many of the best dividend stocks also happen to be great companies. The type of consistency we crave in our dividends tends to be a cultural consistency and one that can be found throughout the years of various management at the firm. On the surface, we are looking for dividend stocks to buy. But in reality, we are looking for dividend aristocrats that can deliver across the board. That doesn’t mean simply paying out or raising a dividend. It also includes consistency with its business and the long-term returns generated for investors. Put simply, I want to own a business that can hold up to various fluctuations in the stock market, regardless of what’s going on. Let’s look at a few dividends for 2023.

JNJ Johnson & Johnson $162.13
PEP PepsiCo $193.38
O Realty Income $61.92

Dividend Stocks to Buy: Johnson & Johnson (JNJ)

Source: Dmitry Lobanov/

There’s one moment that really sticks with me and that was April 2020. The Covid-19 pandemic had exploded around the world and stocks were getting killed. It wasn’t odd to see the S&P 500 down 5%, 6%, 7%, or more — in a single session!

Then Johnson & Johnson (NYSE:JNJ) reported solid earnings, told a pretty reassuring tale, and raised its dividend. The stock jumped 4.5% the next day and the report kickstarted a 12.5% rally in the share price. What a way to reassure investors during a time of immense uncertainty. Fast-forward a few years and the firm recently raised its dividend for the 61st consecutive year. While it pays just a 2.9% dividend yield, it’s one of the most dependable yields in the market. Then consider J&J’s other attributes and it becomes very difficult to ignore.

For instance, shares trade at roughly 15 times this year’s earnings estimates, while analysts expect mid-single-digit earnings and revenue growth. That’s a rather low valuation and even if the growth rate isn’t robust, growth is growth and in a tough environment, that’s all we can ask for.

PepsiCo (PEP)

A hand reaches out of a mailbox holding a wad of cash.

Source: Shutterstock

Want something with a little bit more growth? Try out PepsiCo (NYSE:PEP), a name every investor knows. This stock has quietly rallied to all-time highs and given the uncertain investing environment, it’s no surprise that investors are piling into names with predictable earnings and dependable cash flow.

Think about it. PepsiCo not only dominates the beverage space with brands like Pepsi, Mountain Dew, Gatorade, Tropicana, OceanSpray, and others, but it also dominates snack brands too, owning Tostitos, Ruffles, Rold Gold, Lay’s, Cheetos, Doritos and plenty of others. Put simply, PepsiCo dominates the food and beverages aisles at the grocery store. In good times and bad, there will be demand for its products — and so far, demand has remained pretty strong.

The company recently beat earnings and revenue expectations and gave a slight boost to its organic growth expectations. Further, PepsiCo upped its dividend by 10%. While it yields “just” 2.65%, the firm has now raised its payout in 51 consecutive years. So regardless of what the stock market does, it’s clear that PepsiCo is one of the best dividend stocks out there.

Realty Income (O)

7 Winning High-Yield Dividend Stocks With Payouts Over 5%

Source: Shutterstock

A list of dividend stocks to buy in any environment could be pretty long. Perhaps the hardest was choosing between Procter & Gamble (NYSE:PG) and Realty Income (NYSE:O). Ultimately I went with the latter, but there is a pretty big caveat to mention.

This is not a stock for short-term investors. Further, Realty Income — or O stock for short — is one of the few stocks out there that hasn’t gone on to make new highs since the Covid-19 selloff. Conversely, P&G has roared to 52-week highs in recent trading. Despite the rally, P&G trades at roughly 26 times earnings with a nearly non-existent growth forecast for this year. That’s okay for some investors, as P&G is a dividend stud. However, Realty Income shouldn’t be ignored either.

Although there is the commercial real estate risk that could weigh on REITs — that being the “caveat” I mentioned a moment ago — Realty Income is really impressive when it comes to long-term investors buying, holding, and dripping the dividend. Shares yield just over 5%, the highest on this list, while the company pays its dividend monthly, not quarterly. Lastly, it has raised its dividend in 102 consecutive quarters (or more than 25 years) and has paid its monthly dividend consecutively for more than 52 years!

On the date of publication, Bret Kenwell held a long position in JNJ. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

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