Major U.S. indices experienced a successful year in 2024, driven by the excitement surrounding artificial intelligence and interest rate reductions. However, the potential impact of macro uncertainty on investor confidence in 2025 is a concern. In such a scenario, investors seeking steady income may find dividend stocks a valuable addition to their investment portfolios.
Prominent analysts on Wall Street can assist investors in selecting appealing dividend stocks that provide reliable payments supported by strong fundamentals. Here are three dividend-paying stocks recommended by top Wall Street professionals, as identified by TipRanks, a platform that evaluates analysts based on their historical performance.
Firstly, Ares Capital (ARCC) is a specialty finance provider that offers financing solutions to private middle-market companies. With a quarterly dividend of 48 cents per share, ARCC stock presents a yield of 8.7%. RBC Capital analyst Kenneth Lee, in a research note on the 2025 outlook for business development companies (BDC), maintained a buy rating on ARCC with a price target of $23, naming it RBC’s preferred BDC choice for 2025. Lee highlighted ARCC’s leading position in the BDC sector, emphasizing its scale advantages, strong originations engine, and extensive experience in the field.
Moving on to ConocoPhillips (COP), an oil and gas exploration and production company, which exceeded third-quarter earnings expectations and raised its full-year output guidance due to operational efficiencies. COP also increased its quarterly dividend by 34% to 78 cents per share and expanded its share repurchase authorization by up to $20 billion. With an annualized dividend per share of $3.12, COP stock offers a dividend yield of 3%. Mizuho analyst Nitin Kumar upgraded ConocoPhillips stock to buy from hold, citing its robust balance sheet, cash returns, and anticipated synergies from the Marathon Oil acquisition.
Lastly, Darden Restaurants (DRI), a restaurant company owning popular brands like Olive Garden and LongHorn Steakhouse, recently reported its second-quarter fiscal 2025 results and raised its annual sales guidance. DRI announced a quarterly dividend of $1.40 per share, offering a yield of approximately 3%. BTIG analyst Peter Saleh reiterated a buy rating on DRI stock, praising the company’s ability to meet full-year guidance through various strategies. Saleh highlighted the positive performance of Darden’s chains and the company’s effective response to changing consumer trends, anticipating strong performance in the latter half of fiscal 2025.
