In this article, we will take a look at some of the best dividend stocks on Robinhood.
The start of 2020 marked a turning point for retail trading, driven by increased market volatility, stay-at-home orders, and commission-free trading across platforms, which led to a surge in activity and a rise in new traders. Many of these new traders, particularly in their 20s and 30s, found the stock market more accessible than ever, as high prices had previously kept them from participating. With sports events canceled, many turned to stock trading as a replacement for sports betting.
As stock prices hit historic lows, younger investors flocked to platforms like Robinhood. Founded in 2013 by Vladimir Tenev and Baiju Bhatt, Robinhood quickly became a fintech favorite. The app, which pioneered commission-free trading, amassed 13 million user accounts and gained significant brand recognition, surpassing legacy brokerages like Charles Schwab and Fidelity, as well as app-first competitors like Webull and Dough.
According to analysts, Robinhood has significant growth potential, particularly if it can encourage customers who have opened accounts to invest larger sums of money on the platform. Piper Sandler analyst Patrick Moley highlighted that while 10% of US adults have a funded account with Robinhood, the company currently controls less than 0.3% of the $65 trillion in retail assets in the US As of June 2024, Robinhood has facilitated over $200 million in asset transfer and retirement account contribution matches for its customers. This initiative helped the company secure over $13 billion in net deposits during the second quarter, with assets under custody reaching a record $140 billion—an increase of 57% from the previous year. Additionally, retirement assets more than doubled, nearing $9 billion.
Though Robinhood experienced significant growth in its customer base during the COVID-19 pandemic, as people stayed home and invested in their government stimulus checks, years later, the platform has continued to attract even more customers, many of whom have become more knowledgeable and now expect advanced tools, which Robinhood has adapted to offer.
Robinhood has been focusing on organic growth by implementing strategies such as deposit matches and marketing initiatives, as well as investing in both its current operations and new ventures. Additionally, the company has been using mergers and acquisitions (M&A) to accelerate its business expansion.
In addition to technological improvements, shifts in asset classes and market structure have also played a role in the emergence of new investment products. One of the most notable innovations in 2024 was the introduction of event contracts, especially those based on elections. In addition, many other brokerages, fintech firms, and financial institutions introduced a wide range of new products that reshaped how retail investors could manage their investments, all while generating profits. The shift began in January when the Securities and Exchange Commission approved spot bitcoin (BTCUSD) exchange-traded funds. This decision enabled retail investors to gain cryptocurrency exposure through their brokerage accounts, eliminating the need to open digital wallets for direct crypto purchases.
That being said, we will now discuss some of the best dividend stocks on Robinhood.
Photo by Vitaly Taranov on Unsplash
Our Methodology:
For this article, we performed an extensive analysis of leading financial websites to identify 10 dividend stocks available on Robinhood. Our selection process was based on a consensus approach, where we considered only those stocks that consistently appeared across multiple sources during our research. We also considered hedge fund sentiment around each stock using Insider Monkey’s data for Q3 2024. The stocks are ranked according to hedge funds having stakes in them.
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 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here).
10. Altria Group, Inc. (NYSE:MO)
Number of Hedge Fund Holders: 32
Altria Group, Inc. (NYSE:MO) is an American tobacco company that manufactures a wide range of related products including cigarettes and other nicotine products. In its recently announced Q4 2024 earnings, the company posted revenue of $5.11 billion, which showed a 1.63% growth from the same period last year. The revenue also beat analysts’ estimates by $59.6 million. Its top brands allowed its core tobacco businesses to achieve strong income growth and margin expansion, while also making strategic investments for the future. For 2025, the company anticipates delivering adjusted diluted earnings per share (EPS) between $5.22 and $5.37, reflecting a growth rate of 2% to 5% compared to the base of $5.12 in 2024.
The tobacco industry has experienced significant changes in recent years. While global smoking rates have declined, many consumers are opting for smoke-free alternatives like e-cigarettes and oral tobacco, which are perceived as less harmful and have gained popularity. Altria Group, Inc. (NYSE:MO), known for brands like Marlboro and Parliament, seems to be successfully adapting to these shifts by broadening its range of smoke-free products. In the past 12 months, the stock has surged by over 30%.
Altria Group, Inc. (NYSE:MO) has always remained committed to returning value to shareholders. In FY24, the company distributed $6.8 billion to investors through dividends. In addition, its dividend growth streak currently spans over 55 years, which makes it one of the best dividend stocks on our list. The company offers a quarterly dividend of $1.02 per share and has a dividend yield of 7.81%, as of January 30.
At the end of Q3 2024, 32 hedge funds tracked by Insider Monkey held stakes in Altria Group, Inc. (NYSE:MO), compared with 36 in the preceding quarter. These stakes have a total value of $2.27 billion. With over 22 million shares, Arrowstreet Capital was the company’s leading stakeholder in Q3.
9. Nucor Corporation (NYSE:NUE)
Number of Hedge Fund Holders: 32
Nucor Corporation (NYSE:NUE) is an American steel production company, based in North Carolina. The US steel industry is continuously evolving due to a mix of internal and external influences, offering the company opportunities to compete, adapt, and innovate. Nucor distinguishes itself by diversifying into higher-margin specialty products, such as data center racks and industrial garage doors, which help stabilize profitability beyond the cyclical nature of the steel market. Despite facing recent challenges, the company continues to be profitable, maintaining a manageable debt-to-equity ratio of 0.33. Its strategic approach of using downturns to make acquisitions and invest in assets positions it strongly for future growth. Since the start of 2025, the stock has surged by over 12%.
In the fourth quarter of 2024, Nucor Corporation (NYSE:NUE) reported revenue of $7.08 billion, which fell by over 8% from the same period last year. However, the revenue beat analysts’ estimates by $348 million. The management said that although steel demand weakened in 2024, market conditions are beginning to improve and are expected to gain momentum as 2025 progresses. The US economy is still at the beginning of several steel-intensive megatrends, and as the largest and most diversified steel producer in America, Nucor is well-positioned to meet these growing needs.
Nucor Corporation (NYSE:NUE) has grabbed investors’ attention because of its solid financial position and dividend policy. The company ended the quarter with over $4 billion available in cash and cash equivalents. Moreover, it generated nearly $4 billion in operating cash flow in FY24. In December 2024, the company declared a 1.9% increase in its quarterly dividend to $0.55 per share. This marked the company’s 52nd consecutive year of dividend growth, which makes NUE one of the best dividend stocks on Robinhood.
As of the close of Q3 2024, 32 hedge funds in Insider Monkey’s database owned stakes in Nucor Corporation (NYSE:NUE), down from 40 in the previous quarter. The overall value of these stakes is over $487 million. Among these hedge funds, D E Shaw was the company’s leading stakeholder in Q3.
