We recently published a list of 10 Best Annual Dividend Stocks To Buy Now. In this article, we are going to take a look at where Bayerische Motoren Werke Aktiengesellschaft (XETRA:BMW.DE) stands against other best annual dividend stocks to buy now.
In 2025, dividends in MSCI Europe are expected to reach a record high. According to Allianz Global Investors, these firms are likely to increase dividend payouts by 4% year-over-year to €459 billion, up from €440 billion in 2024. In 2026, MSCI Europe dividends could catapult even higher to €496 billion. In Germany alone, payouts are projected to rise from €57 billion in 2024 to €63 billion in 2025, and possibly hit €70 billion in 2026. Allianz Global expects the Tech and Healthcare sectors to offer the highest dividend increases in 2025, while the Energy sector could likely create some weakness. The Financials sector will remain the biggest dividend contributor in Europe. Dividend yields are staying ahead of long-term German government bond yields as well, with the MSCI Europe dividend yield expected to be 3.5% this year.
Over the last 40 years, about 39% of MSCI Europe’s total annualized return resulted from dividends. Comparatively, dividend payouts made up 22% of total returns in MSCI North America and just over 41% in MSCI Pacific.
Jenny Harrington, CNBC Halftime Report’s go-to expert on dividends, observed that the broader market’s dividends have grown about 5.7% in the last 50-60 years, which means that dividend income is outpacing inflation. She also noted that dividends are a tax-advantaged income stream, which is a huge plus. Harrington also commented that dividend investors are more likely to hold their portfolios rather than selling in a panic when markets go down. They are reluctant to give up their income streams and risk wasting years of effort, which helps keep dividend portfolios steady and resilient, even during market selloffs.
Harrington also told investors that some companies may not have strong growth potential but generate high free cash flow, allowing them to pay dividends. However, those seeking high-growth stocks should carefully balance their portfolios. Harrington advised investors to explore opportunities beyond the broader market, as the index is heavily dominated by its top 10 stocks. She suggested that looking at other companies, including dividend stocks, could offer better value and growth potential. Given this, we will now take a look at some of the best annual dividend stocks.
Our Methodology
For this article, we manually researched annual reports and company websites to see which stocks pay dividends annually. We focused on picking stocks with a consistent record of paying dividends, offering dividend growth, and being financially stable to steer clear of yield traps. The list below is ranked in the ascending order of dividend yield as of February 6.
At Insider Monkey, we are obsessed with 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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here)
Bayerische Motoren Werke Aktiengesellschaft (XETRA:BMW.DE)
Dividend Yield as of February 6: 7.86%
Number of Hedge Fund Holders: N/A
Bayerische Motoren Werke Aktiengesellschaft (XETRA:BMW.DE) manufactures and sells BMW, MINI, and Rolls-Royce vehicles, along with spare parts, accessories, and mobility services. It is one of the most popular automobile companies worldwide. It is one of the best dividend stocks to consider. The company issued its last annual dividend in May 2024.
BMW Group kept up its momentum in 2024, delivering 426,594 fully electric vehicles (BEVs), which indicates a 13.5% increase compared to 2023. Both BMW and MINI brands saw double-digit BEV growth, with BMW up 11.6% (368,523 units) and MINI surging 24.3% (56,181 units). Even Rolls-Royce made waves, delivering 1,890 BEVs and recording a staggering 479.6% jump. Outside of China, BMW managed to grow sales across all vehicle types and regions.
That said, the second half of the year wasn’t smooth sailing. Delivery stops due to Integrated Brake System (IBS) issues and weak demand in China forced BMW to adjust its full-year sales target. In the end, the company delivered 2,450,804 vehicles in 2024, with electrified models making up 24.2% of total sales (593,215 units) and fully electric vehicles accounting for 17.4%. Looking ahead to 2025, BMW is optimistic about continued BEV growth, supported by strong demand in Europe and an expanding lineup of electric models.
Overall, BMW.DE ranks 2nd on our list of best annual dividend stocks to buy now. Overall, BMW.DE ranks first on our list of the best annual dividend stocks. While we acknowledge the potential of BMW.DE to grow, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than MBG.DE but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.
