Long-term investors buy stocks to build their nest eggs over time as the stock market rises, but dividend stock investors actually get paid for their patience. Companies that pay dividends take a portion of their profits and distribute them directly to investors on a semiannual, quarterly or monthly basis.
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Let’s be honest: Nothing in life is guaranteed other than death and taxes. But some income stocks are so consistent with their payouts and well-established as companies that their dividends are as close to a sure thing as you’ll find on Wall Street.
Here are 10 of the best dividend stocks to buy for virtually surefire income that have yields of at least 2%, according to Bank of America analysts:
| Stock | Implied upside over Jan. 24 close | Forward yield |
| Procter & Gamble Co. (ticker: PG) | 15% | 2.5% |
| Genuine Parts Co. (GPC) | 35.5% | 2.7% |
| Emerson Electric Co. (EMR) | 27.1 | 2.2% |
| Cincinnati Financial Corp. (CINF) | 1.8% | 2.7% |
| Coca-Cola Co. (KO) | 1.9% | 3.1% |
| Colgate-Palmolive Co. (CL) | 12.4% | 2.4% |
| International Business Machines Corp. (IBM) | -2.3% | 3.8% |
| Sysco Corp. (SYY) | 6.7% | 2.7% |
| Target Corp. (TGT) | 14.9% | 3.2% |
| PepsiCo Inc. (PEP) | 26.8% | 3% |
Procter & Gamble Co. (PG)
Procter & Gamble produces household consumer products and owns several popular brands, including Pampers, Tide and Gillette. Analyst Bryan Spillane recently cut his three-year revenue growth outlook for Procter & Gamble, but he says the company remains one of the best consumer packaged goods operators. Spillane says Procter’s innovation and price laddering will help protect its earnings even in difficult consumer environments. He says the company is positioned to generate stable, long-term earnings and revenue growth, exactly the type of performance dividend investors seek. Bank of America has a “buy” rating and $175 price target for PG stock, which closed at $152.12 on Jan. 24.
Sector: Consumer staples Yield: 2.5%
Genuine Parts Co. (GPC)
Genuine Parts is a wholesale distributor of automotive replacement parts, industrial parts, office products and other supplies. Analyst Elizabeth Suzuki says Genuine has a long track record of dividend hikes, and dividend payments and share buybacks made up more than 40% of the company’s capital deployment in the past four years. Suzuki says Genuine’s ability to maintain a healthy balance sheet even as it completes regular roll-up acquisition deals is impressive. She prefers the stability and consistency of Genuine over competitor Advance Auto Parts Inc. (AAP). Bank of America has a “buy” rating and $192 price target for GPC stock, which closed at $141.67 on Jan. 24.
Sector: Consumer discretionary Yield: 2.7%
Emerson Electric Co. (EMR)
Emerson Electric is a diversified global industrial technology company. Analyst Andrew Obin says Emerson has an opportunity to gain market share in its core businesses while expanding into new areas, such as life sciences, electronics, and food and beverage. Obin also anticipates synergies from its National Instruments acquisition, which closed in October 2023. In the long term, he says Emerson’s transition to a pure-play industrial automation company could lead to earnings multiple expansion for the stock. He projects 15.4% revenue growth in 2024. Bank of America has a “buy” rating and $120 price target for EMR stock, which closed at $94.39 on Jan. 24.
Sector: Industrials Yield: 2.2%
Cincinnati Financial Corp. (CINF)
Cincinnati Financial is an insurance holding company that primarily markets property and casualty coverage but also provides life insurance and asset management services. Analyst Grace Carter says she expects higher fixed income yields and faster improvement of Cincinnati’s core loss ratio will boost the company’s earnings per share moving forward. Carter says the company is navigating a difficult loss cost environment, but those risks are fully reflected by the stock’s depressed valuation. She says Cincinnati Financial’s cautious approach to reserving could eventually lead to EPS upside. Bank of America has a “buy” rating and $115 price target for CINF stock, which closed at $112.95 on Jan. 24.
Sector: Financial Yield: 2.7%
Coca-Cola Co. (KO)
Coca-Cola is one of the world’s most valuable brands and is the largest manufacturer of soft drinks and syrups. Spillane says Coca-Cola has positive business momentum heading into 2024, and its scale and pass-through pricing leverage give it resilient earnings power. Organic sales growth has been driven by volume growth, pricing upside and improving product mix. Spillane says Coca-Cola is a best-in-class consumer staples stock that has a clear strategic vision and is exposed to an attractive combination of mature, profitable markets and higher-growth emerging markets. Bank of America has a “buy” rating and $60 price target for KO stock, which closed at $58.91 on Jan. 24.
Sector: Consumer staples Yield: 3.1%
[See: 9 Dividend Aristocrats to Buy Now.]
Colgate-Palmolive Co. (CL)
Colgate-Palmolive produces household and nutrition products, including toothpaste, toothbrushes, shampoos and deodorants. Spillane says Colgate has an opportunity to exceed consensus earnings and revenue estimates in 2024 thanks to several key catalysts. Growth in non-measured channels, marketing and merchandising investments, new product launches and easier year-over-year comparisons could all help the company’s financial performance in coming quarters. Spillane says pricing leverage in Latin America and impressive growth in India are also positive developments, and he projects margin expansion for Colgate-Palmolive in 2024. Bank of America has a “buy” rating and $90 price target for CL stock, which closed at $80.08 on Jan. 24.
Sector: Consumer staples Yield: 2.4%
International Business Machines Corp. (IBM)
IBM is a global technology company that provides enterprise software, infrastructure and services. IBM pays a 3.8% dividend, the highest yield of any stock on this list. Analyst Wamsi Mohan says IBM has an attractive setup heading into 2024, including margin expansion opportunities and revenue growth tailwinds. Mohan says IBM remains a successful turnaround story. In addition, he says IBM is an undervalued, defensive tech stock investment that offers a rare combination of high dividend yield and exposure to artificial intelligence and quantum computing technology. Bank of America has a “buy” rating and $170 price target for IBM stock, which closed at $173.93 on Jan. 24.
Sector: Information technology Yield: 3.8%
Sysco Corp. (SYY)
Sysco is a large distributor of food and related products to the food service and food-away-from-home industries. Analyst Kendall Toscano says Sysco is positioned to gain market share in 2024 thanks to its scale and investments in customer-facing and supply chain initiatives. Toscano says productivity and supply chain improvements will help Sysco expand its margins. In addition, he says the company’s high-margin local and independent customer business is gaining momentum, and credit and debit card data from December indicate restaurant spending is trending higher. Bank of America has a “buy” rating and $80 price target for SYY stock, which closed at $74.99 on Jan. 24.
Sector: Consumer staples Yield: 2.7%
Target Corp. (TGT)
Target is one of the largest U.S. discount retailers. Analyst Robert Ohmes says he expects margin expansion and significant traffic improvement for Target in fiscal 2025. He says Target’s merchandising initiatives will pay off for the company, and easing year-over-year comparisons will help improve same-store sales numbers. Ohmes says Target is executing well in a difficult consumer environment, and the company’s focus on low-price offerings and new brands will likely continue to support sequential traffic improvements. He projects 7.6% EPS growth in fiscal 2025. Bank of America has a “buy” rating and $160 price target for TGT stock, which closed at $139.20 on Jan. 24.
Sector: Consumer staples Yield: 3.2%
PepsiCo Inc. (PEP)
PepsiCo is a global beverage and snack company. Spillane says PepsiCo trades at a valuation premium relative to non-alcoholic beverage peers, but the stock deserves a premium valuation thanks to its superior pricing power, positive momentum, productivity improvements, and opportunities for solid earnings and revenue growth. Spillane anticipates shareholder returns will remain in the high single-digit percentage range driven by a balance of dividend payments, share buybacks and growth. He projects 5% organic sales growth in fiscal 2024, including 5% pricing gains. Bank of America has a “buy” rating and $210 price target for PEP stock, which closed at $165.60 on Jan. 24.
Sector: Consumer staples Yield: 3%
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Update 01/25/24: This story was previously published at an earlier date and has been updated with new information.
