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As top AI stocks take a breather amid valuation and demand concerns, investors are expected to increase their focus on dividend stocks in 2025 for stable income and portfolio diversification. Lord Abbett said in its 2025 outlook report that investors could benefit from high-quality dividend stocks with long histories of dividend growth in 2025. But which dividend stocks should you buy for 2025? Let’s take a look at a case study for ideas.
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About two years ago, someone asked r/Dividends – a discussion board for dividend investors on Reddit with over 640,000 members – whether anyone was living off dividends. The post received several responses, with many interesting stories of dividend investors. But one story got our attention.
An investor said he was making about $160,000 in annual dividend income with an average portfolio yield of about 4.3%. He, 72, advised fellow investors to focus on blue chip stocks with dividend growth track record.
See Also: If there was a new fund backed by Jeff Bezos offering a 7-9% target yield with monthly dividends would you invest in it?
“Best advice: learn and understand utilities. It’s the only sector where the government guarantees a profit (regulated utilities). Stick with mostly blue chips,” he said.
The investor named a few holdings in his comment and mentioned many others in a separate Reddit post. Let’s look at some of the top dividend stocks in his portfolio.
Realty Income
Realty Income Corp (NYSE:O) was the biggest position of the investor, who made $160,000 per year in dividends. In a separate Reddit discussion, the investor said he’d been buying O shares when the stock was trading at around $18.
“Only time I ever sold was when it hit 80. I’m retired now and it’s my largest position 4,828 shares, unrealized gain of $25k. It will move up when interest rates come down and as they continue to raise dividends,” he said.
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Enbridge
Canadian energy pipeline company Enbridge Inc. (NYSE:ENB) was among the biggest holdings in the portfolio. According to Benzinga Pro, the stock yields about 6.3%. In early December, the company increased its dividend by 3%.
