Looking to earn extra income without doing much work? Dividend-paying stocks might be a great option.
These are stocks that reward you — the shareholder — with regular payments, usually every few months. These payments come from the company’s profits and can be in the form of cash or extra shares. Over time, dividends can give you a steady stream of income and boost your total returns. Plus, many dividend-paying companies are stable and well-established, which means their stock prices may not swing as wildly as others.
Sounds good, right? Let’s dive in.
🏆 Top Dividend Stocks in 2025 (So Far)
Here are 10 stocks with the highest dividend yields as of July 21, 2025, according to Fidelity’s stock screener (log-in required). These companies also have an upcoming ex-dividend date within the next 180 days — meaning they tend to pay dividends regularly.
| Ticker | Company Name | Dividend Yield |
|---|---|---|
| MSB | Mesabi Trust | 27.02% |
| ORC | Orchid Island Capital Inc. | 20.40% |
| OXSQ | Oxford Square Capital Corp. | 18.03% |
| HRZN | Horizon Technology Finance Corp. | 16.38% |
| DX | Dynex Capital Inc. | 16.28% |
| PSEC | Prospect Capital Corp. | 15.93% |
| AGNC | AGNC Investment Corp. | 15.57% |
| PNNT | PennantPark Investment Corp. | 13.19% |
| SAR | Saratoga Investment Corp. | 11.94% |
| EFC | Ellington Financial Inc. | 11.88% |
Note: These aren’t investment recommendations, just examples for your research.
💡 What Is Dividend Yield?
Dividend yield is a quick way to measure how much a company pays in dividends compared to its stock price. Here’s a simple formula:
Annual Dividend ÷ Share Price = Dividend Yield
For example, if a stock pays $1 every quarter and is priced at $100:
($1 × 4) ÷ $100 = 4% dividend yield
It helps you compare how much income you’re getting for your investment — but there’s more to the story.
Also Read: What Stocks Do Billionaires Keep Buying in 2025?
⚠️ The Risks of Chasing High Yields
High dividend yields can look tempting — but be careful. Sometimes a high yield is a red flag.
Why?
- Falling Stock Prices: Often, the yield looks high because the stock price has dropped. That could mean the company is in trouble.
- Dividend Cuts: A company can lower or stop paying dividends at any time. And when they do, their stock usually takes a hit.
- Company Problems: Extremely high yields often come from companies facing financial stress or risk of bankruptcy.
- One-Time Payments: Some stocks show a high yield because of a special one-time dividend, not regular payments.
That’s why it’s better to look for reliable dividends, not just the biggest ones.
Also Read: What’s the Best Way to Start Investing with $100?
✅ Safer Dividend Stocks with Sustainable Yields
Smart investors often look for companies with:
- Good coverage ratios (profits comfortably cover the dividend)
- Healthy free cash flow (enough cash to keep paying)
- A strong history of paying dividends (especially through tough times)
Here are 10 companies that may offer more stable dividends, as of July 21, 2025:
| Ticker | Company Name | Dividend Yield |
|---|---|---|
| CFG | Citizens Financial Group Inc. | 3.46% |
| RY | Royal Bank of Canada | 3.38% |
| JNJ | Johnson & Johnson | 3.18% |
| PB | Prosperity Bancshares Inc. | 3.15% |
| STT | State Street Corporation | 3.10% |
| ALV | Autoliv Inc. | 3.03% |
| MET | Metlife Inc. | 2.94% |
| MS | Morgan Stanley | 2.84% |
| LEVI | Levi Strauss & Co. | 2.68% |
| CMI | Cummins Inc. | 2.28% |
Again, these are not recommendations — just examples to guide your research.
📦 What About Dividend ETFs?
Exchange-Traded Funds (ETFs) can be a great way to invest in a bunch of dividend-paying companies at once. They’re easy to trade, often lower-cost, and professionally managed.
Here are five high-yield dividend ETFs as of July 21, 2025:
| Ticker | ETF Name | Yield |
|---|---|---|
| FDL | First Trust Morningstar Dividend Leaders ETF | 4.41% |
| FDVV | Fidelity High Dividend ETF | 2.95% |
| VYM | Vanguard High Dividend Yield ETF | 2.63% |
| SDY | SPDR S&P Dividend ETF | 2.57% |
| VOE | Vanguard Mid-Cap Value ETF | 2.29% |
🔍 Other Ways to Invest in Dividends
1. Dividend-Focused Mutual Funds
Let professionals do the picking. Mutual funds pool investors’ money and invest in dividend-paying stocks. Examples from Fidelity include:
- Fidelity® Equity Dividend Income Fund (FEQTX)
- Fidelity® Equity-Income Fund (FEQIX)
- Fidelity® Growth & Income Portfolio (FGRIX)
- Fidelity® Strategic Dividend & Income® Fund (FSDIX)
2. Separately Managed Accounts (SMAs)
SMAs are like personalized investment plans run by a professional manager. They offer more control and can use tax-smart strategies to help with dividend taxes.
3. Curated Screens
Fidelity also offers pre-built screens (some with expert research) to help find dividend-paying stocks, ETFs, or real estate investment trusts (REITs).
Also Read: How Do Dividends Work and Who Pays Them?
Final Thoughts
Dividend stocks can be a great way to earn income, especially if you’re building a long-term portfolio. But don’t just chase the highest numbers — look for companies with healthy finances and a reliable track record.
Happy investing!