Today, in this article, we will be looking at the 10 safest dividend stocks you might be interested in adding to your portfolio.
The stock market has become increasingly volatile, constantly causing investors to look for stability. But few instruments offer stability as much as dividend-paying stocks.
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With fresh trade tensions arising from unprecedented policy revisions from Washington, price appreciation alone may not be a dependable strategy for investors. Income-focused portfolios are becoming more than just a hedge. They are a necessity.
President Trump made a recent announcement, an update to the new tariff policies, whereby a whopping 145% rate is slapped on Chinese imports while maintaining a 10% baseline for other countries for 90 days. Negotiations are expected between the U.S. and other countries during this period, which, if they do not go well, will bring back the reciprocal tariffs originally announced on April 2, 2025. The announcement sent ripples once again across the global trade. All the major indices are struggling to find equilibrium in the middle of the uncertainty. The situation further raises the importance of stabilized equities that could remain immune to the market whiplash up to some level.
In this regard, safe dividend stocks provide income without compromising their defensiveness – qualities that are becoming harder to ignore in today’s time. Investments in dividend stocks are not just about cushioning against losses but also about long-term compounding and shareholder rewards. Investors prioritize dividends for the sake of sustainable yield that builds wealth gradually. Companies with strong dividend track records have historically stood against worse market conditions more effectively than their non-dividend counterparts. These stocks have safely harbored elevated capital inflow at times of increased volatility, indicating their trust in the broader market.
Recent market turmoil sees value-based investments in dividend-yielding equities becoming a compelling alternative to growth stocks investing among institutional players. Multiple strategists covered by CNBC noted portfolio managers pulling their investments from speculative names and diverting into more fundamentally grounded positions to overcome the unpredictable policy actions and inflation volatility.
But which dividend stocks to pick? Investors are facing not only economic cycles in today’s market environment but also political cycles. Trade, taxation, and regulation are politicized so that the markets are exposed to a profoundly impactful risk that cannot be quantified. It calls for a revisal of a portfolio that includes equities rooted in strong fundamentals and offers high yields.
With this in mind, our article will explore the 10 safest stocks investors could buy now to add resilience to their portfolios. Our curated selection is designed to offer consistent payouts and protect capital from the tremors induced by policies today. You might want to safeguard your capital, generate passive income, or just sleep better at night. Our picks in this article offer you all these in a market that is anything but predictable.
Our Methodology
When assembling our list, we followed a few criteria to optimize our picks for the investors. Primarily, we included those stocks with a minimum market cap of $2 billion to ensure the financial soundness of the companies. We also aimed for those stocks that have outperformed the benchmark, so we excluded those below the 52-week market performance of 3%.
Since we want our article to benefit income-seeking investors, we placed a dividend yield limit of a minimum of 2%. Above all, we included only those stocks with a beta of 0.5 or less. A higher beta suggests higher volatility in market events, which increases the potential risks. All the data in the article was taken from financial databases and analyst reports, with all information updated as of April 11, 2025. The stocks are ranked according to their dividend yield. We have also looked into the hedge fund backing the stock to estimate the institutional interests.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10. Unum Group (NYSE:UNM)
Beta: 0.42
Dividend Yield: 2.20%
No. of Hedge Funds: 43
A Tennessee-based company, Unum Group (NYSE:UNM) is a leading provider of disability insurance, life insurance, and employee benefits across the U.S. and the UK. The company’s client base is comprised of corporate clients and individuals, and its offering includes long-term disability, critical illness, and dental coverage. Against dominating competitors like MetLife and Prudential, Unum Group (NYSE:UNM) uses its actuarial expertise, digital platforms, and strong broker networks to diversify its market share.
The company’s 52-week market performance stands at 46.76%, the highest on our list, against the market indices’ 3%. Unum Group (NYSE:UNM) surpassed the previous expectations and achieved an EPS growth of 10%. Subsequently, the company raised its dividend by 15%. Additionally, through a repurchase program, the company repurchased $1 billion of shares in 2024. It has translated positively among the shareholders. For 2025, the company anticipates an 8% to 12% increase in EPS and intends to return the value further to the shareholders through increased dividends.
With a beta of just 0.42 and a comparatively low dividend yield of 2.20%, Unum Group (NYSE:UNM) establishes a balance between capital appreciation and low but stabilized income. As per the Insider Monkey database of Q4 2024, 43 hedge funds hold positions in the stock, making it one of the attractive, safe dividend stocks.
9. The Hanover Insurance Group, Inc. (NYSE:THG)
Beta: 0.49
Dividend Yield: 2.24%
No. of Hedge Funds: 31
The Hanover Insurance Group, Inc. (NYSE:THG), headquartered in Massachusetts, is a property and casualty insurance provider offering tailored coverage for businesses, individuals, and institutions. The company serves the U.S. markets through independent agents with a portfolio of personal lines, commercial multiline, and specialty segments. The Hanover Insurance Group, Inc. (NYSE:THG) gains its market share through its competitive edge, which results from its underwriting discipline, agent partnerships, and customer-focused risk solutions. The diversified risk base positions it well for sustained profitability in the insurance sector.
The Hanover Insurance Group, Inc. (NYSE:THG) has made a solid 21.5% increase in stock price over the 52 weeks, performing better than the market indices. A notable contribution to this high performance was the successful implementation of the catastrophe mitigation actions. Operating income per share, in particular, increased from $3.13 to $5.32 per diluted share in the last quarter. The specialty segment has also performed significantly well. The company saw a net written premium growth of 8.8% in the fourth quarter due to targeted investments in talent and technology. The Hanover Insurance Group, Inc. (NYSE:THG) anticipates the growth to continue in 2025, allowing it to raise its dividend for the 21st consecutive year.
With a manageable beta of 0.49, the company remains resilient to market changes. While its 2.24% yield is modest, it remains consistent, attracting investors. Backed by 31 hedge funds, the company is one of the safest stocks to buy for investors seeking income and safety for their capital.
8. H&R Block, Inc. (NYSE:HRB)
Beta: 0.29
Dividend Yield: 2.53%
No. of Hedge Funds: 27
Missouri-based company H&R Block, Inc. (NYSE:HRB) is a leading provider of tax preparation services, financial advisory products, and small business solutions. The company operates across digital platforms and retail locations, annually serving millions of individuals and SMEs. H&R Block, Inc. (NYSE:HRB) puts up tough competition in the market with a nationwide presence that supports its hybrid service delivery. The company ensures its preferences among customers in the evolving tax and personal finance sectors through affordability and accuracy.
The 23.37% 52-week surge suggests far more than just tax season momentum. Despite the growth, H&R Block, Inc. (NYSE:HRB) has missed the analyst expectations for its Q4 adjusted EPS by 8.6%, reaching -$1.73. For 2025, the company has announced an EBITDA guidance of $975 million to $1.02 billion. The company also expects the effective tax rate to be around 13%, leading to a one-time benefit to EPS of approximately 50 cents. Additionally, the company has been consistently increasing its dividend since 2016, having returned $4.4 billion to shareholders in the form of share repurchases in addition to dividends, hence holding a positive outlook from investors.
With a beta of 0.29 and a 2.53% dividend yield, the stock maintains stability without losing its growth, thus earning its position among the safest stocks to buy. Twenty-seven hedge funds held stakes in the company’s stock, as per Insider Monkey’s Q4 2024 database, suggesting moderate institutional interest.
7. CMS Energy Corporation (NYSE:CMS)
Beta: 0.42
Dividend Yield: 2.92%
No. of Hedge Funds: 33
CMS Energy Corporation (NYSE:CMS) offers electric and natural gas services to close to 7 million customers in Michigan, where it is headquartered. The company primarily operates through its principal subsidiary, Consumers Energy, focusing on clean energy and infrastructure reliability. Competing against strong contenders like DTE Energy and Xcel Energy, CMS Energy Corporation (NYSE:CMS) generates market share through a balanced approach to energy generation. This approach, which includes renewables and natural gas, supports regulatory compliance in an ever-changing utility environment.
The 52-week gain of 24.09% far surpasses the broader market, and CMS Energy Corporation (NYSE:CMS) also announced an adjusted EPS of $3.34 in Q4 2024, which was at the high end of its guidance range. The new five-year $20 billion utility customer investment plan, which is almost an 18% increase from the previous plan, is expected to deliver an 8.5% rate base growth by the end of 2029. Additionally, the data centers and manufacturing sector are expected to increase annual load growth by 3% in Michigan, thus receiving a positive outlook for the 2025 performance.
The beta of just 0.42 makes CMS Energy Corporation (NYSE:CMS) a favorite for low-risk portfolios. The 2.92% dividend yield represents the conservative risk profile. Insider Monkey database noted 33 hedge funds holding positions at the end of Q4 2024, earning a solid place among the safest stocks to buy.
6. Pinnacle West Capital Corporation (NYSE:PNW)
Beta: 0.47
Dividend Yield: 2.94%
No. of Hedge Funds: 38
Pinnacle West Capital Corporation (NYSE:PNW) is the parent company of Arizona Public Service (APS), which delivers electricity to more than a million customers. Their generation portfolio includes nuclear, solar, and natural gas. Operating from its Arizona headquarters, the company prioritizes grid reliability and sustainability. Compared to other utility companies like El Paso Electric and NV Energy, Pinnacle West Capital Corporation (NYSE:PNW) survives in the market through its focus on energy innovation in desert environments. The company leverages solar capacity expansion to support Arizona’s growth.
Pinnacle West Capital Corporation (NYSE:PNW) has quietly delivered a high growth of 24.97% in the past 52 weeks, eclipsing the broader market. The full-year EPS of the company in 2024 reached $5.24, an increase of $0.83 from 2023. In the Q4 quarter results, the company has also announced a 2.1% growth in customer rate, which is above their midpoint guidance range for 2024. For 14 consecutive years, Pinnacle West Capital Corporation (NYSE:PNW) has been increasing its dividend per share at an average rate of 1.73%, demonstrating its commitment to increasing shareholder value. The company has also set the long-term EPS growth guidance between 5% and 7%.
The company’s low beta of 0.47 and a 2.94% dividend yield make it preferable for conservative investors seeking relatively less risky dividend stock. Institutional confidence in the stock stands high, with 38 hedge funds backing the company, as per Insider Monkey’s Q4 2024 database.
5. Public Service Enterprise Group Incorporated (NYSE:PEG)
Beta: 0.49
Dividend Yield: 2.99%
No. of Hedge Funds: 42
Based in New Jersey, the diversified energy company Public Service Enterprise Group Incorporated (NYSE:PEG) is primarily engaged in regulated electric and gas utility operations through its subsidiary, PSE&G. The company serves customers across New Jersey with a heavy investment focused on energy efficiency, grid modernization, and renewable integration. Public Service Enterprise Group Incorporated (NYSE:PEG) distinguishes itself from its competitors with its nuclear generation capacity and commitment to decarbonization. Additionally, its strong infrastructure and regulatory stability pave the way for the company’s long-term energy transition leadership.
The 23.32% return over 52 weeks, when the large caps have achieved less than 3%, demonstrates Public Service Enterprise Group Incorporated (NYSE:PEG)’s growth stability during challenging market conditions. Having reached a net income of $3.54 per share in 2024, the company achieved the high end of its non-GAAP operating earnings guidance range of $3.68 per share. For the 14th consecutive year, the Board of Directors has announced an increase of $0.12 per share of the annual common dividend. Public Service Enterprise Group Incorporated (NYSE:PEG) also gained approval to invest $2.9 billion in its Clean Energy Future Energy Efficiency 2 program. The program is expected to increase energy efficiency and reduce carbon emissions, leading to the company’s value growth in 2025.
The restrained beta of 0.49 reflects Public Service Enterprise Group Incorporated (NYSE:PEG)’s strong market insulation. A dividend yield of 2.99% ensures income continuity, while the strong institutional interest, represented by 42 hedge funds, indicates the underappreciated potential of the company as one of the safest stocks to buy.
4. Consolidated Edison, Inc. (NYSE:ED)
Beta: 0.28
Dividend Yield: 3.08%
No. of Hedge Funds: 44
Consolidated Edison, Inc. (NYSE:ED) is a major investor-owned energy company serving over 10 million people across New York, New Jersey, and Pennsylvania. Operating from New York through subsidiaries like Con Edison and Orange & Rockland, the company offers electric, gas, and steam services. The focus of the company is heavily laid on increasing urban energy resilience and transitioning to cleaner energy sources, which gains its competitive advantage used for supporting the company’s long-term sustainability.
Consolidated Edison, Inc. (NYSE:ED) offers a classic example of safe investing by providing a 52-week performance that exceeds the market’s 3%. The adjusted earnings for Q4 2024 increased to $5.40 per share, up from $5.07 during the same period the previous year. Generating a net income of $190 million, the company has also announced a dividend of $0.79 per share. Based on its investment plans, the company will make a capital investment of $5.12 billion in 2025 and $8.07 billion in 2026, adding value to its stocks. As per their 2025 guidance, a 6% to 7% growth rate is anticipated with respect to adjusted EPS.
The beta of 0.28 exhibits remarkable stability against the changing market environment. Its 3.08% dividend yield further boosts its credibility. Consolidated Edison, Inc. (NYSE:ED) has attracted 44 hedge funds, as per Insider Monkey’s Q4 2024 database, making it an appealing candidate for the safest stocks to buy in a volatile economic environment.
3. TXNM Energy, Inc. (NYSE:TXNM)
Beta: 0.15
Dividend Yield: 3.14%
No. of Hedge Funds: 30
TXNM Energy, Inc. (NYSE:TXNM) is an emerging energy company headquartered in Texas and engaged in the exploration, development, and production of oil and natural gas, primarily across the Permian Basin. The company is a relatively minor operator in a highly competitive market dominated by peers like ExxonMobil and Pioneer Natural Resources. TXNM Energy, Inc. (NYSE:TXNM) focuses on operational efficiency, well productivity, and cost control to gain its competitive edge in the market. Additionally, the company is moving forward with a significant emphasis on unconventional drilling and lean capital structure in energy markets.
TXNM Energy, Inc. (NYSE:TXNM) defies the norm by surpassing the market indices with a 52-week performance of 38.17%. In Q4 2024, the reported EPS of $0.30 did not meet the anticipated EPS of $0.32. However, in the growth outlook announced by the company, an increase of 7% to 9% is expected concerning long-term earnings. Additionally, TXNM Energy, Inc. (NYSE:TXNM) increased its 5-year capital investment plan to $7.8 billion, a 26% increase compared to the prior plan. The plan is expected to contribute immensely to the 2025 consolidated earnings guidance of $2.74 to $2.84 per diluted share.
TXNM Energy, Inc. (NYSE:TXNM) has an exceptionally low beta of 0.15, which signals an abnormal stability for such high returns, making the stock stand out among the safest stocks to buy. The dividend yield of 3.14% adds income appeal to the stock. Interest from 30 hedge funds suggests increasing institutional confidence.
2. DTE Energy Company (NYSE:DTE)
Beta: 0.50
Dividend Yield: 3.28%
No. of Hedge Funds: 35
A Michigan-based company, DTE Energy Company (NYSE:DTE) provides electric and gas utility services to approximately three million customers in Michigan. The business operations include regulated utility businesses and non-utility energy infrastructure investments. Incorporating carbon emissions reductions, renewable energy investments, and grid modernization into its long-term plans, the company has positioned itself as a leader in sustainable energy in the Midwest despite tough competition from its peers like FirstEnergy and CMS Energy.
DTE Energy Company (NYSE:DTE) has quietly delivered a 52-week performance of 21.18% annual return – nearly seven times the market index. The company offered the high end of its EPS guidance in 2024, reaching a value of $6.83 in 2024. It has also announced an EPS guidance of $7.09 – $7.23 for 2025, a 7% increase compared to the 2024 guidance midpoint. DTE Energy Company (NYSE:DTE) further has detailed its next 5-year investment plan of $30 billion, which is $5 billion up from its previous 5-year plan. The plan is expected to increase reliability and transition to a cleaner generation.
DTE Energy Company (NYSE:DTE)’s beta of 0.50, the highest on our list of safe dividend stocks, suggests some level of control over volatility. A high dividend yield of 3.28% increases the investor appeal. Backed by 35 hedge funds at the end of Q4 2024, institutional confidence in the stock remains high in the utility sector.
1. American Electric Power Company, Inc. (NASDAQ:AEP)
Beta: 0.45
Dividend Yield: 3.56%
No. of Hedge Funds: 47
American Electric Power Company, Inc. (NASDAQ:AEP), an Ohio-based company, is among the largest electric utility companies in the U.S. The company delivers electricity to over five million customers across 11 states. The grid modernization initiatives and the substantial investment in clean energy transition allow the company to gain a competitive edge over its peers in the market. Their regulatory alignment provides resilience despite the changing energy policy frameworks.
American Electric Power Company, Inc. (NASDAQ:AEP) has achieved a 52-week gain of 25.7%, vastly outperforming the market’s 3%, suggesting strong stability. The performance contributed to a 7% year-over-year increase in its operating earnings per share. American Electric Power Company, Inc. (NASDAQ:AEP) will gain full control of its transmission business for a $2.82 billion transaction, closing in mid-2025, which is expected to boost its earnings further. Accordingly, the Q4 report indicated an operating earnings guidance range of $5.75 to $5.95 per share for 2025. Company guidance also expects a 6% to 8% growth rate for its operating earnings between 2025 and 2029, to be supported by a $54 billion capital plan.
The company’s beta stands low at 0.45, indicating minimal volatility. American Electric Power Company, Inc. (NASDAQ:AEP) offers a dividend yield of 3.56%. With 47 hedge funds piling onto the stock, the institutional interest is high, thus earning its position in our list of the safest stocks to buy.
Overall, American Electric Power Company, Inc. (NASDAQ:AEP) ranks first on our list of the safest stocks to buy that pay dividends. While we acknowledge the potential of AEP as an investment, our conviction lies in the belief that some deeply undervalued dividend stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued dividend stock that is more promising than AEP but that trades at 10 times its earnings and grows its earnings at double digit rates annually, check out our report about the dirt cheap dividend stock.
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