The 10 Best Dividend Stocks
These are the top dividend-paying stocks to buy today.
What should investors look for when it comes to choosing the best dividend stocks to buy today?
At Morningstar, we think that the best dividend stocks aren’t simply the highest dividend stocks or the top-performing dividend stocks. We suggest that investors look beyond a stock’s yield and short-term performance—instead, choose stocks with durable dividends and buy those when they’re undervalued.
How to Find the Best Dividend Stocks
“Tempting as they might be, the stock market’s juiciest yields are often illusory,” explains Dan Lefkovitz, strategist for Morningstar Indexes. “High dividend yields are often found in risky sectors, industries, and companies.” And as a result, such high dividend yields can’t always be maintained.
Investors seeking durable dividends should instead focus on companies with management teams that support their dividend strategies and favor companies with competitive advantages, or
“Moats signify a durable competitive advantage. Moats protect profits from competition. And profits fund dividends,” reminds Lefkovitz.
Investors looking for good dividend stocks to buy might consider adding undervalued dividend stocks with economic moats to their portfolios.
10 Best Dividend Stocks to Buy
To find the best dividend stocks to invest in, we turn to the Morningstar Dividend Yield Focus Index. The dividend stocks on this list are among the index’s top constituents, have economic moats, and have
- Verizon Communications VZ
- Pfizer PFE
- Procter & Gamble PG
- PepsiCo PEP
- McDonald’s MCD
- Blackstone BX
- Medtronic MDT
- Duke Energy DUK
- Lockheed Martin LMT
- PNC Financial Services PNC
Here’s a little bit about each cheap dividend stock, along with some key Morningstar metrics. All data is through Sept. 25.
Verizon Communications
- Morningstar Rating: 4 stars
- Morningstar Economic Moat Rating: Narrow
- Forward Dividend Yield: 6.01%
- Sector: Communication Services
Verizon tops our list of the best dividend stocks to buy; it’s also the highest-yielding stock on our list. The stock is trading 13% below our fair value estimate of $54 per share. Morningstar senior analyst Mike Hodel notes that price cuts have revived customer growth this year. He adds that Verizon directed 60% of 2025’s cash flows to the dividend and has started to repurchase shares.
Review Verizon Communications’ dividend history.
Pfizer
- Morningstar Rating: 4 stars
- Morningstar Economic Moat Rating: Narrow
- Forward Dividend Yield: 6.00%
- Industry: Healthcare
Pfizer is one of the higher-yielding stocks on our list of best dividend stocks to buy. We assign Pfizer stock a $32 fair value estimate, and it currently trades 10% below that. “We think Pfizer is well poised to return to growth after near-term headwinds,” says Morningstar director Karen Andersen. Those headwinds include some patent losses in 2026-28. She notes that Pfizer holds a very strong financial position, adding that the company has generally targeted close to a 50% payout in dividends as a percentage of normalized earnings, which seems about right for a more mature industry.
Review Pfizer’s dividend history.
Procter & Gamble
- Morningstar Rating: 4 stars
- Morningstar Economic Moat Rating: Wide
- Forward Dividend Yield: 2.98%
- Sector: Consumer Defensive
Procter & Gamble is the first consumer defensive name on our list of the best dividend stocks to buy; its shares are trading just 6% below our $155 fair value estimate. With a portfolio of leading brands such as Tide, Charmin, and Pampers, the company has carved out a wide economic moat. Morningstar director Erin Lash notes that Procter & Gamble is in solid financial health, and we forecast that it will increase its dividend at a high-single-digit pace, implying an average annual
Review Procter & Gamble’s dividend history.
PepsiCo
- Morningstar Rating: 5 stars
- Morningstar Economic Moat Rating: Wide
- Forward Dividend Yield: 4.60%
- Sector: Consumer Defensive
The second dividend king on our list, Pepsi trades 24% below our $169 fair value estimate. We don’t expect near-term challenges from consumer belt-tightening to derail Pepsi’s growth from innovation and international expansion, reports Morningstar senior analyst Kristoffer Inton. Over the next decade, we expect Pepsi’s payout ratio to stabilize in the low 70s on average and the dividend payment to increase at a mid-single-digit pace annually, Inton says.
Review PepsiCo’s dividend history.
McDonald’s
- Morningstar Rating: 4 stars
- Morningstar Economic Moat Rating: Wide
- Forward Dividend Yield: 3.26%
- Sector: Consumer Cyclical
McDonald’s is the first dividend aristocrat on our list of top dividend stocks to buy, which means it has increased its dividend for at least 25 consecutive years. The company earns a wide economic moat rating, thanks to its strong intangible assets and a cost advantage. Morningstar analyst Ari Felhandler notes that the company’s sturdy balance sheet has supported generous shareholder distributions, with the company returning, on average, 56% of earnings as dividends over the past five years. We anticipate a 59.0% payout profile on average over our 10-year forecast, with dividends growing at a 9.4% rate annually, Felhandler says. The stock is trading 20% below our $295 fair value estimate.
Review McDonald’s dividend history.
Top 10 Dividend Stocks to Buy in 2026
Blackstone
- Morningstar Rating: 4 stars
- Morningstar Economic Moat Rating: Wide
- Forward Dividend Yield: 4.42%
- Sector: Financial Services
Blackstone is one of the world’s largest alternative-asset managers; this cheap dividend stock trades 19% below our $147 fair value estimate. Blackstone has built a team with decades of industry experience in revitalizing companies through cost-cutting, acquisitions, or other strategic initiatives, says Morningstar senior analyst Greggory Warren. Troubles in the private credit market have weighed on shares this year, but its more balanced portfolio should help Blackstone manage headwinds better than some of its competitors. Warren expects dividend payments to account for 85% of distributable earnings annually.
Review Blackstone’s dividend history.
Medtronic
- Morningstar Rating: 4 stars
- Morningstar Economic Moat Rating: Narrow
- Forward Dividend Yield: 3.25%
- Sector: Healthcare
The second dividend aristocrat on our list of best dividend stocks to buy, Medtronic shares trade 21% below our $112 fair value estimate. The largest pure-play medical-device maker is a key partner for its hospital customers, thanks to its diversified product portfolio aimed at a wide range of chronic diseases, Morningstar senior analyst Debbie S. Wang explains. The company aims to return a minimum of 50% of its annual free cash flow to shareholders, but this has been in the 60% to 70% range in recent years, according to Wang.
Review Medtronic’s dividend history.
Duke Energy
- Morningstar Rating: 4 stars
- Morningstar Economic Moat Rating: Narrow
- Forward Dividend Yield: 3.83%
- Sector: Utilities
Duke Energy stock is trading 13% below our $131 fair value estimate. One of the largest regulated utilities in the US, Duke has carved out a narrow economic moat because of the constructive regulatory environments in which much of its regulated business operates and better-than-average economic fundamentals in its key regions, explains Morningstar senior analyst Andrew Bischof. Duke’s liquidity position and cash flow generation should give investors confidence that it can maintain and increase its dividend, he says, and we expect 5% annual dividend growth over time.
Review Duke Energy’s dividend history.
Lockheed Martin
- Morningstar Rating: 4 stars
- Morningstar Economic Moat Rating: Wide
- Forward Dividend Yield: 2.66%
- Sector: Industrials
The only company from the industrials sector on our list of good dividend stocks, Lockheed Martin is trading 20% below our $650 fair value estimate. As a bet on the defense industry, wide-moat Lockheed is hard to beat, argues Morningstar analyst Nicolas Owens. “Biggest isn’t always best, but Lockheed (and investors) benefit from the sheer scale of its tens of billions of dollars of contracts that provide defined decades-long revenue and profit streams,” he explains. Given the company’s conservatively run balance sheet, stable business model, and strong history of returning capital to shareholders, the dividend will likely remain a priority.
Review Lockheed Martin’s dividend history.
PNC Financial Services
- Morningstar Rating: 4 stars
- Morningstar Economic Moat Rating: Narrow
- Forward Dividend Yield: 3.55%
- Sector: Financial Services
PNC Financial Services rounds out our list of the best dividend stocks to buy. One of the larger regional banks in the US, PNC maintains a healthy dividend payout ratio of over 40%, notes Morningstar analyst Maoyuan Chen. Over the past decade, the bank returned 75% of its earnings to shareholders in dividends and buybacks. PNC stock trades 11% below our fair value estimate of $253 per share.
Review PNC Financial Services’ dividend history.
What Is the Morningstar Dividend Yield Focus Index?
A subset of the Morningstar US Market Index (which represents 97% of equity market capitalization), the Morningstar Dividend Yield Focus Index tracks the top 75 high-yielding stocks that meet our screening requirements for quality and financial health.
How are the stocks selected for the index? Only securities whose dividends are qualified income are included; real estate investment trusts are excluded. Companies are then screened for quality using the
The 75 highest-yielding stocks that pass the quality screen are included in the index, and constituents are weighted according to the total dividends paid by the company to investors.
The Best Dividend Stocks: More Ideas to Consider
Investors who would like to uncover more cheap dividend stocks to research can do the following:
- Review the full list of dividend stocks included in the Morningstar Dividend Yield Focus Index. Those dividend stocks with Morningstar Ratings of 4 or 5 stars are undervalued, according to our metrics.
- Browse our list of Best Investments: Exemplary Stewards With High Dividends. The list includes companies with durable competitive advantages that are run by excellent capital allocators whose stocks trade well below our fair value estimate and offer at least a 4% dividend yield.
- Bookmark our dividends topic page to stay up to date on Morningstar’s newest dividend stock content.
How to Screen for More Top Dividend Stocks
Dividend-stock investors can use our Morningstar Investor Screener tool to find stocks with above-average dividend yields that offer maintainable dividend income potential. To build your screen, include the following filters:
Dividend per share growth (10Y): Click the Add Filter button on the left-hand side of the Screener, then search for the data point. Set the range you’d like to target, for example, greater than or equal to 5%, either by entering a figure or dragging the slider.
Dividend yield (trailing): Scroll to the bottom of the left-hand side of the Screener and set your range, for example, greater than or equal to 4%.
Morningstar Rating for Stocks: While not directly related to dividends, filtering to see only 4- or 5-star (undervalued) stocks helps you find overlooked dividend stocks with potential upside.
Economic Moat: Similarly, while moat isn’t directly tied to dividends, selecting stocks with a wide or narrow economic moat can identify companies with durable competitive advantages—and perhaps more secure dividend payments, too.
The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.
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