No-brainer dividend stocks provide investors with a safe place to put their money and leave it. A dividend is the distribution of a company’s earnings to its shareholders that typically takes the form of a quarterly distribution. However, some dividend distributions are made on a monthly or annual basis.
Most dividends are paid out as cash or in the form of a reinvestment in additional stock of the company. How much of a dividend an investor gets depends on how many shares of a company’s stock they hold.
Over time, dividend payments can add up significantly and many people come to depend on them as a source of income, particularly in retirement. Investors with big stock holdings can earn millions of dollars a year from dividend distributions.
That’s just one of many high-yielding dividend stocks the Oracle of Omaha has in his portfolio. Here are seven no-brainer dividend stocks to buy if you have money to invest.
|Campbell Soup Company
Altria Group (Mo)
With a dividend that yields 7.85%, Altria Group (NYSE:MO) easily makes any list of no-brainer dividend stocks to buy. Investors will be hard-pressed to find another stock with as high a dividend yield.
The average dividend yield among companies listed on the S&P 500 index is just 1.69%. That said, it is important to note that Altria Group is one of the world’s biggest tobacco companies.
Altria is the parent company of Philip Morris and its most well-known product is Marlboro cigarettes. Altria Group also has a stake in e-cigarette maker Juul. The high dividend yield is partly to help investors overcome any qualms they might have about investing in a company that makes an unhealthy product.
Investors who are okay with so-called “sin stocks” should consider Altria for its monster dividend yield that translates into a quarterly payout of $0.90 per share.
Another reason to consider an investment in MO stock is that it has outperformed the broader market so far this year. Since January, Altria stock has declined 4%. That’s a much better performance than the 15% year-to-date drop in the benchmark S&P 500.
Altria also rewarded investors by repurchasing more than 21 million of its own shares in the first six months of 2022.
Verizon (NYSE:VZ) is a household name and known for its telecommunications services, notably its mobile network, which counts more than 120 million subscribers. That makes Verizon the biggest wireless carrier in the U.S.
VZ stock also pays a huge dividend yield of 5.92% which is one of the very biggest payouts among technology companies. Consider that many leading technology companies, such as Google parent company Alphabet (NASDAQ:GOOGL) and Amazon (NASDAQ:AMZN), pay no dividend, and Verizon’s yield looks truly exceptional. The dividend payment of VZ stock is currently $0.64 a share per quarter.
As with many of the no-brainer dividend stocks to buy on this list, the high dividend yield is designed to attract and keep investors despite the chronic underperformance of VZ stock.
Verizon has declined 21% over the past 12 months and is down 10% over the last five years. At $43.25 a share, VZ is currently changing hands at around the same price it was at in 2007.
Shareholders can console themselves, knowing that they’re earning a decent income from holding the stock in their portfolio. Verizon looks well-positioned for the future, having recently spent $45.5 billion to acquire the most 5G internet spectrum among major U.S. carriers. As no-brainer dividend stocks go, the 5G bet seems obvious.
The ultra-high dividend is to compensate for the disappointing performance of IBM stock over the past two decades. At its current price, IBM stock is trading at the same level it was in July 1999.
IBM got as high as $200 a share in 2013 but has largely struggled for many years, much to the irritation of shareholders. But there is hope for IBM stock.
Last November, IBM spun off its long-in-the-tooth managed infrastructure services arm, which is basically its army of more than 90,000 information technology consultants, into a new publicly traded company called Kyndryl (NYSE:KD).
That leaves IBM to focus on more profitable business areas that include computer hardware, software, nanotechnology, artificial intelligence and research. KD stock is down 73% since going public last fall and trading at $10.89 a share.
Intel (NASDAQ:INTC) is another struggling technology company with a strong dividend that currently yields 4.38%.
Still the world’s largest semiconductor chip manufacturer by revenue, Intel has lost ground in recent years to competitors that include Nvidia (NASDAQ:NVDA) and Advanced Micro Devices (NASDAQ:AMD). However, it makes the cut as one of the no-brainer dividend stocks to buy because Intel is fighting its way back.
INTC is investing billions of dollars in developing advanced semiconductors and microchips. Specifically, the company has announced plans to invest $20 billion in two new chip fabrication plants in Ohio.
The two Ohio plants are the first step towards a mega-site that will eventually house eight chip factories at a development cost of $100 billion. The heavy investments and time required to revamp Intel’s operations weighs on INTC stock, which is down 37% this year.
The dividend yield translates to a $0.37 per share quarterly payout to patient shareholders. It’s worth noting that with a price-to-earnings ratio (P/E) of just 7.15, INTC stock looks extremely cheap right now. Investors with a long time horizon might want to buy into Intel’s turnaround story.
Another semiconductor company that pays a strong dividend is Broadcom (NASDAQ:AVGO), with a 3.15% dividend yield. That’s a strong payout from Broadcom, whose semiconductors are used to help power data storage centers and wireless networks.
Unlike the other tech companies on this list, AVGO stock has performed well for shareholders, having risen 4% in the past year and gained 106% over the last five years. That makes it the no-brainer of no-brainer dividend stocks. Currently sporting a P/E ratio of 25.81, Broadcom is not cheap. But it is worth it for the dividend and share price appreciation.
Broadcom first paid investors a quarterly dividend of $0.07 a share in the fourth quarter of 2010. Since then, the company has grown its dividend payout by 20% annually to its current level of $4.10 a share per quarter.
At the end of its fiscal second quarter this year (ended on May 31), Broadcom paid dividends to shareholders worth $3.5 billion, which equaled a payout ratio of 47%, making the AVGO stock dividend very sustainable.
Investors can reasonably expect further dividend increases for many years to come. Broadcom certainly has strong earnings to justify increasing its dividend payouts, with net income in the past two quarters growing 81% to $4.9 billion.
Despite the success of its many toys, HAS stock has also struggled in recent years, trading 18% lower today than where it was five years ago.
The company’s stock has been hamstrung in recent years by the ill-fated acquisition of media company Entertainment One in 2019 for $4 billion. At that time, Hasbro was looking to spin its toys brands into films and TV shows. But there are now rumors that Hasbro is planning to sell off Entertainment One and adopt a back-to-basics approach.
Hasbro is expected to provide more information on its intentions for Entertainment One at its upcoming investor day conference this October. In the meantime, the company has partnered with The New York Times Co. (NYSE:NYT) to develop a new board game based on the popular Wordle digital puzzle.
Campbell Soup (CPB)
Lastly, we come to the Campbell Soup Company (NYSE:CPB), one of the biggest processed food companies in the U.S. and an easy inclusion on a list of no-brainer dividend stocks to buy.
CPB stock offers a dividend yield of 2.92%, good for a quarterly payment of $0.37 a share. In addition to the dividend, Campbell Soup’s stock has been fairly reliable over the years. At its current price of $50.69 a share, the stock is up 16% this year, far outpacing the S&P 500 index. In the last five years, CPB stock has gained 12%.
Analysts note that Campbell Soup is the type of consumer staple stock that tends to outperform in times of economic uncertainty and during periods of high inflation. Indeed, the company’s most recent earnings were very strong, leading several analysts who cover the company to issue upwardly revised price targets on CPB stock.
The company also issued bullish forward guidance and made clear that it is able to manage inflation pressures and continue to grow this year despite a challenging environment. Analysts seem to agree that Campbell Soup is a best-of-breed consumer staple stock. The high dividend yield is just icing on the cake.
On the date of publication, Joel Baglole held long positions in GOOGL and NVDA. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.