3 Healthy Dividend Stocks to Buy Before It’s Too Late

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As temperatures rise and summer vacations approach, many investors are seeking ways to keep their portfolios thriving. Investing alongside seasonal trends can reveal growth and income opportunities worth considering. In this article, I'm going to highlight three dividend stocks that are certainly seeing strong growth, and may fit many investors' rebalancing needs this summer, for a variety of reasons.

I think it's important for investors to consider dividend-paying stocks for a few reasons. Indeed, dividend stocks offer two things that investors can be confident of: stable income and long-term growth. Unlike growth stocks, dividend-paying companies provide capital redistribution to shareholders which forces them to continue to grow cash flows over time. These distributions also pay investors to be patient, creating the kind of investor base companies generally want over the long-term.

Companies who are consistent with paying out dividends (and raising their distributions) generally also are among the strongest fundamental picks in the market. That's no accident. A commitment to shareholders is one that certain companies focus on, and that's the kind of company I think long-term investors want to own.

With that in mind, here are three top options investors may want to consider right now.

Key Points About This Article:

• Dividend-paying companies pay investors to be patient, providing fundamental stability to a portfolio during times of distress.
• The three following companies have the right mix of strong fundamentals and growth outlooks that make them worth considering for increased potential volatility moving forward.
• If you’re looking for some stocks with huge potential, make sure to grab a free copy of our brand-new “The Next NVIDIA” report . It features a software stock we’re confident has 10X potential.

Exxon Mobil (XOM)

Image of an Exxon Mobil gas station with three pumps

Oil giant company Exxon Mobil ( NYSE:XOM ) just released its Q2 results , and the market was impressed. The company's success this past quarter was mostly driven by strong production in Guyana and Texas. The company's management team announced $2.14 in earnings per share, surpassing the consensus $2.01 forecast. Exxon's sales of $93.06 billion also surpassed estimates. So, this past quarter provided a handy top and bottom-line beat for investors to hang their hats on.

Moreover, the company's $60 billion acquisition of the Pioneer Natural Resources also boosted XOM stock following the print. This deal, which was completed in May, allowed the company to increase production by 15%, which equates to 4.4 million barrels per day. Exxon has continued to pass its increased cash flows onto investors, paying out $4.30 billion in dividends and $5.20 billion in buying back its own stock. So far, XOM stock has surged 10.2% this year, outperforming its rivals.

Currently, XOM stock appears to be forming a base with a $123.75 buy point . However, this stock has briefly broken out before reversing back lower. If Exxon can exceed this level and find new support higher, I think it's reasonable to project XOM stock could end the year around the $130 level, all else being equal.

Of course, oil prices will continue to be the story for Exxon moving forward, and those global prices are really outside the company's control. Geopolitical risks are clearly higher, but so are recession risks. So, we'll have to see how the near- to medium-term outlook for the company changes over time. But for long-term investors, buying on dips (such as the recent one we just saw) has proven to be a solid long-term strategy. I don't think much has changed for those with a truly long-term investing time horizon right now when it comes to this divided behemoth.

Altria (MO)

A young man vaping, exhaling a large amount of vapor

Another leading dividend stock, Altria Group ( NYSE:MO ) finds itself second on this list. The company is known for its innovative tobacco products, be they e-cigarettes, vapes, and other smokeless nicotine products. Indeed, Altria continues to benefit from steady demand from a rather loyal customer base. The company owns world-class brands in its sector, with Marlboro remaining the company's flagship cigarette brand it's best-known for. In Q1 2024, the company announced $4.7 billion revenue, with Altria seeing significant growth from its non-cigarette businesses, which should continue to drive growth for long-term investors.

In June, four of Altria’s e-cigarette products were approved by the FDA. This marked as its first approval for non-tobacco flavors. To add, this opened as help for adult smokers to switch from traditional cigarettes.

When it comes to dividends, Altria is as consistent as they come. In fact, the company has been giving out dividend payouts for 54 years now. Currently, MO stock pays out a $0.98 per share quarterly dividend, with a 8.02% yield as of July 17. That's a hefty yield, and one investors may think is at risk of a cut. But that's not Altria's modus operandi, and I don't think the company will do anything but raise its distribution over time, making this a top value pick (at only 8.7-times earnings ) as well.

In general, I'm not a fan of cigarettes as a whole. But the nicotine market is expanding in new directions, and Altria's existing market share paves the way for the company to transform into something better. For those looking for value, a high yield, and one that's likely to grow, this is a top option right now, to be sure.

Starbucks (SBUX)

Photo of a Starbucks sign outside of a location

As the leading global coffee company, Starbucks ( NASDAQ:SBUX ) remains popular not only in the U.S but worldwide too. The company began in 1971 in Seattle, and now has 36,000 branches internationally. Starbucks aims to expand 55,000 stores by 2030, adding eight new branches everyday. In China, Starbucks plans to open 9,000 stores by next year. This increases exposure for the company in Asian and Latin America locations.

Starbucks has been great in adapting to market trends. The company has been focusing more on modern needs and improving its mobile app and drive-thru ordering systems. Customer experience is also their top priority, especially now that it launched Deep Brew AI. In the past 10 years, revenue grew 8.86%, net income by 39.09%, impressing the market.

Currently, Starbucks now ranks as the top coffee stock to own due to its extensive global brand. It also has strong growth potential that could go on for years. Despite macroeconomic issues, the company is well-positioned for global expansion, based on its Q1 reports . Analysts think SBUX could see a 12.02% upside in current levels.

With a dividend yield of 3% , SBUX stock is one that investors may want to consider more for its yield than its long-term growth (though I do think Starbucks' growth metrics should improve over time). If you're an investor looking for a bond proxy in a declining interest rate environment, this isn't a bad pick at all.

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