In a blog post this week, Morningstar investment specialist Susan Dziubinski lists the 10 best dividend stocks to buy in 2025, according to the firm’s analysts.
To identify these stocks, analysts turned to the Morningstar Dividend Yield Focus Index, a subset of the firm’s US Market Index, which tracks 75 high-yield stocks that meet screening requirements for quality and financial health.
Only securities whose dividends are qualified income are included in the index; real estate investment trusts are excluded. Analysts screen for quality by using Morningstar’s economic moat and uncertainty ratings: companies must earn a moat rating of narrow or wide and an uncertainty rating of low, medium or high.
David Harrell, editor of Morningstar DividendInvestor, says a moat rating, a measure of a company’s competitive advantage, does not guarantee dividends, but he notes that Morningstar has observed some strong correlations between economic moats and dividend durability.
The index’s screen for financial health uses a distance-to-default measure, which taps market information and accounting data to determine how likely a firm is to default on its liabilities; it is a measure of balance-sheet strength.
The 75 highest-yielding stocks that pass the quality screen and make it into the index are weighted according to the total dividends paid by the company to investors.
See the accompanying gallery for the 10 top dividend-paying stocks, all of which have economic moats and were trading in the 4- and 5-star range as of Aug. 1. Year-to-date performance is as of Aug. 5.
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