People who know me know I’m not a pessimist. But, you have to admit, with the roller-coaster ride that is 2025, it’s hard not to feel the fear of recession slowly creep up on you. With the latest dismal US job numbers and the long-term effects of tariffs starting to kick in, some investors are racing to protect their capital.
Fortunately, several sectors have a good chance to withstand the rigors of an impending recession, like medicine, utilities, and customer staples. Combine that with companies offering consistent dividend payments and increases over long periods - like Dividend Aristocrats and Kings - and you've got yourself a safety net that will generate income as you wait out the rough, choppy waves of future economic uncertainty. These companies may not have the highest dividends or triple-digit YTD returns, sure, but what they lack in flash, they make up for in resilience, consistency, and long-term reliability.
Today, let’s take a look at the best dividend stocks that may help carry your portfolio through a recession.
How I Came Up With The Following Stocks
To get my list, I jumped into Barchart’s Stock Screener tool and entered the following filters:
- Dividend Payout Ratio: 60% and below. The payout ratio is the portion of a company’s net income used to pay dividends. 60% means the company is quite generous, yet still leaves enough for itself for capital investments.
- Market Sectors: Consumer Staples, Medical/Healthcare, and Utilities. These three sectors are among the most resilient in the market.
- Current Analyst Rating and Number of Analysts: 4 (Moderate Buy) to 5 (Strong Buy), and 12 or more. High ratings plus high coverage mean more confidence in the result.
- Annual Dividend Yield: Left blank so I can sort by it later.
- Watchlists: Dividend Aristocrats (25+ years of consecutive dividend increases) and Dividend Kings (50+ years of consecutive dividend increases) only.
I got six results and arranged the companies from highest to lowest dividend yield. Initially, I planned to discuss the top three, but since the top four offer great diversification, I’ll cover them all.
NextEra Energy (NEE)
Sector: Utilities
NextEra Energy is one of the, if not the largest, electric utility holding company in the US. The company generates electricity through a combination of solar, wind, nuclear, natural gas, and oil projects. It is notable as one of the world’s largest solar and wind power companies through its subsidiary, NextEra Energy Resources.
NextEra currently pays 56.65 cents quarterly, which works out to a $2.26 annual rate and around a 3.22% yield. This Dividend Aristocrat has increased payouts for 31 consecutive years, with its latest increase coming in at roughly 10%, and a total increase of 64.80% over the last five years.
Procter & Gamble Company (PG)
Sector: Consumer Staples - Misc. Products
Procter & Gamble is a worldwide brand recognized for many popular products like Tide, Pampers, Gillette, and Head & Shoulders. With its brand power and the simple, undeniable fact that people like to clean themselves, their clothes, and their homes, regardless of economic condition, P&G enjoys a steady, strong demand for its products.
The company pays $1.0568 quarterly, which translates to $4.2272 per share, per year and around a 2.81% yield. It has also increased dividends for 69 consecutive years (nice), ranking it as both a Dividend Aristocrat and King.
Sysco Corp (SYY)
Sector: Consumer Staples - Food
You’ll notice that I’m saying “the world’s largest” a lot on this list, and for good reason - these are all top-shelf companies. For example, Sysco Corp, the world’s largest foodservice provider, operates in 90 different countries, serving restaurants, healthcare facilities, academic institutions, specialty establishments, and more.
Now, while Sysco and P&G both fall under the Consumer Staples sector, Sysco is more focused on food distribution and servicing, making it a different kind of defensive play.
Recently, the company increased its quarterly dividend from 51 cents to 54 cents, reflecting a $2.16 annual rate and a roughly 2.7% yield. This year marks the company’s 56th consecutive year of dividend increases.
Abbott Laboratories (ABT)
Sector: Healthcare
Last on the list is Abbott Laboratories, which (again) is one of the largest, most diversified healthcare companies in the world. Abbott develops and sells medical devices, diagnostic tools, nutritional products, and generic medicines, giving it a well-diversified revenue stream across almost all essential healthcare areas. It is also one of the most popular dividend stocks right now, with 53 consecutive years of increases and 101 years of consecutive payments.
Today, the company pays $2.36 annually, which translates to an approximate 1.85% yield. It also has the highest 5-year dividend growth on this list at 71.88%.
Final Thoughts
These four companies are some of the safest dividend stocks in the market today, making them perfect for investors seeking steady income through uncertain economic times. However, just as there's no such thing as a free lunch, no investment is “100%-safe”, so it falls to you to do your due diligence, monitor your investments, and keep an eye out for new developments.
On the date of publication, Rick Orford did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
