Top Dividend Stocks to Consider in February 2025

As the global markets navigate a turbulent start to 2025, investors are seeking stability amidst the uncertainty. In this environment, dividend stocks can offer a reliable income stream and potential for growth, making them an attractive option for those looking to balance risk while capitalizing on steady returns. Here, we look at 10 dividend stocks to watch for February 2025, as measured by forward dividend yield. We exclude companies with payout ratios that are either negative or higher than 100%. Data throughout are current as of Jan. 30, 2025.



Best Dividend Stocks to Watch in February 2025

| Ticker | Company | Sector | Market Cap ($B) | Dividend Yield (%) | Price ($) |
| --- | --- | --- | --- | --- | --- |
| NEP | NextEra Energy Partners L.P. | Utilities | 0.9 | 34.27 | 10.14 |
| EC | Ecopetrol S.A. | Energy | 18.6 | 33.70 | 9.50 |
| TRMD | TORM PLC | Transportation | 1.9 | 31.44 | 19.68 |
| HAFN | Hafnia Ltd. | Transportation | 2.6 | 26.89 | 5.22 |
| BWLP | BW LPG Ltd. | Transportation | 2.0 | 23.23 | 13.19 |
| ZIM | ZIM Integrated Shipping Services Ltd. | Transportation | 2.1 | 22.18 | 17.59 |
| OXLC | Oxford Lane Capital Corp. | Financials | 1.8 | 21.30 | 5.10 |
| PBR | Petróleo Brasileiro S.A. | Energy | 85.8 | 21.17 | 12.73 |
| MSB | Mesabi Trust | Materials | 0.4 | 20.48 | 24.52 |
| IEP | Icahn Enterprises L.P. | Energy | 4.9 | 20.29 | 9.80 |

Why Are These the Best Dividend Stocks?

The dividend stocks included on our list represent companies trading on the Nasdaq or the New York Stock Exchange with share prices of $5 or more, a market capitalization of $300 million or more, and a daily trading volume of at least 100,000. Companies with payout ratios that are either negative or over 100% were also excluded from the list. From the pool of companies remaining, we selected those with the highest forward dividend yield for inclusion on our list. Because dividend yield changes all the time with the price of a company's stock, this list is also likely to change quickly. Further, these are not the best dividend stocks of all time; they represent those that rose to the top of the list based on our methodology for this month.

Investors Prioritize Dividend Stocks

Investors prioritize dividend stocks because they provide a steady passive income stream and enjoy the potential for share price growth in the future. Dividends are not necessarily a given, however, even among companies with a history of paying them for many years. Investors should remember that:

* Market conditions impact dividends. The broader economic environment has a significant impact on dividend payments. When there is concern about the ability to maintain operations and top- and bottom-line performance due to external market factors, companies may move to reduce or even eliminate dividends as an early protective measure. This allows them to preserve capital in case of turbulent times to come. On the other hand, booming economies can sometimes prompt companies to increase their dividend payments.
* Dividend yields may be misleading: Dividend-paying companies may increase a dividend yield to entice investors, but higher dividend payments can be unsustainable. Similarly, a dividend yield may appear higher because of falling stock prices. These are reasons why the payout ratio is an important metric to monitor for dividend stocks.

How to Pick Dividend Stocks

Strong dividend stocks tend to be those of companies with solid fundamentals, a strong profitability horizon, and a sustainable dividend yield that has maintained or, ideally, increased over a period of years. Not all sectors and industries are the same when it comes to dividend-paying companies. Finance and energy tend to be sectors with higher dividend payments than others, and real estate investment trusts (REITs) are required to pay out a substantial portion of their income in dividends to shareholders. But it's also important for investors to look not just at a company's sector, but also at its dividend performance relative to other companies in that sector.

What Should Investors Look For in Dividend Stocks?

Dividend Payout Ratio (DPR) is a measure of how much of a company's earnings are paid to shareholders. The DPR is calculated by dividing total dividends by net income and is often included on brokerage platforms as well as financial news sites. As an example, if Company X reported a net income of $50,000 and paid $10,000 in yearly dividends, its DPR would be 20% because $10,000 / $50,000 = 20%. In other words, Company X pays 20% of its earnings to shareholders each year. A DPR of under 50% is typically considered stable and sustainable and may be indicative of long-term growth potential. Higher DPRs could suggest that a company is paying out more in dividends than it can afford, which may not be sustainable in the long run.



In conclusion, investors should prioritize dividend stocks that offer a steady passive income stream and potential for share price growth. By considering market conditions, dividend yields, and payout ratios, investors can make more informed decisions when selecting dividend stocks. The companies listed above represent a diverse range of sectors and industries, offering investors a variety of options to consider in their portfolios.