Dividend stocks offer a comforting cushion to investors, providing a steady income stream without depending solely on price increases to benefit shareholders. This feature becomes particularly appealing in times of market volatility, when uncertainty seems to be the norm.
So far, 2025 has been a highlight of this story for U.S. equities. As of March 25, both the S&P 500 and Nasdaq Composite have been down for the year, even dipping into correction territory. Meanwhile, the Dow Jones Industrial Average barely managed to stay positive, rising by less than 1%.
For those looking to earn income through investments without fretting over stock price fluctuations, the two dividend stocks below could be worthy additions to your portfolio.
1. AT&T
AT&T has been in a challenging spot for much of the past five years. However, its share price has experienced a surprising surge over the last 12 months, climbing more than 60%. While I anticipated a recovery for AT&T’s stock, even I didn’t expect such a swift turnaround this year.
Back in early 2022, AT&T made waves by cutting its dividend nearly in half, dropping from $0.52 per share quarterly to $0.2775. This strategic move aimed to free up cash to tackle its debt and enable the necessary investments as the company sharpened its focus back on its core telecom business.
Despite murmurs of the potential elimination of the dividend in the aftermath of the cut, those concerns have now largely faded. AT&T’s free cash flow reached $17.6 billion in 2024, effectively covering its dividend and debt responsibilities while also allowing room for strategic investment in broadband and fiber services.
While its current 4% dividend yield isn’t as enticing as the average 8% from the past five years, it still sits comfortably at about three times the S&P 500’s average. AT&T’s growth relies heavily on its fiber expansion, which, thankfully, has been promising. In the fourth quarter, revenue from the fiber segment grew 18% year-over-year, and 2024 saw AT&T add 1 million new customers, marking the seventh consecutive year this milestone has been achieved.
For investors wondering about telecom’s longevity, rest assured it’s here to stay, with AT&T positioned as a leading player for the foreseeable future. It’s a solid buy-and-hold dividend stock, although its recent stock price surge shouldn’t be taken as a recurring trend.
2. Coca-Cola
Coca-Cola is a household name across the globe, beloved in over 200 countries, with its flagship soda being an iconic product. Its offerings appeal to consumers no matter the economic climate, which doesn’t make the company immune to recessions but certainly more resilient than many others. This resilience is why Coca-Cola stands as a blue-chip dividend stock.
Currently, Coca-Cola provides a quarterly dividend of $0.51, translating to an average yield of about 2.9% over the past year. More impressively, Coca-Cola is a Dividend King, having consistently increased its dividend for 63 years. In the past decade alone, its dividend saw a 55% increase.
While Coca-Cola isn’t likely to achieve double-digit revenue growth annually due to its sheer size, its allure lies in reliability. Investors can rest assured that the dividend is stable, barring any drastic and unforeseeable market events.
Coca-Cola’s dependability is rooted in its continuous innovation rather than relying solely on flagship products like Coca-Cola Classic, Diet Coke, and Sprite. The company has diversified into waters, coffee, tea, juices, plant-based beverages, and even alcoholic drinks.
For investors seeking a steady, reliable stock that prioritizes rewarding shareholders, Coca-Cola makes for a savvy investment choice.
