3 Brilliant Dividend Stocks to Buy Now and Hold for the Long Term

Reuben Gregg Brewer, The Motley Fool

Fri, Apr 25, 2025, 7:30 AM 4 min read

Few investors enjoy market uncertainty, so the current state of affairs on Wall Street is probably a little unsettling for you. Buying dividend stocks can help calm your nerves because you can focus on collecting dividend checks instead of price volatility. Here are three brilliant dividend stocks that will serve you well now and are well worth holding for the long term.

1. The Monthly Dividend Company to the rescue

If you are watching the markets and feeling a little seasick, you might want to look at buying Realty Income (NYSE: O). The company pays monthly dividends, so it provides investors with a steady stream of income. The dividend, notably, has been increased annually for 30 consecutive years and is backed by an investment-grade-rated balance sheet. The real estate investment trust (REIT) is so focused on dividends that it actually trademarked the nickname, "The Monthly Dividend Company."

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Realty Income is the largest net lease REIT. This means that tenants pay for most property-level operating costs. It is a fairly low-risk approach in the sector when spread across a large portfolio.

Realty Income owns over 15,600 assets across the United States and Europe. And while retail properties make up around 75% of rents, these assets tend to be easy to buy, sell, and release if needed. The other 25% of rents, from things like industrial and gaming properties, provide diversification to the mix.

Historically well run and reliable, this REIT's lofty 5.5% yield should be on your radar screen given the uncertainty on Wall Street today.

2. Prologis is exposed, but you should take the long view

Next up is Prologis (NYSE: PLD), which is the largest REIT in the warehouse niche. It has a global footprint, owning assets in most of the world's major transportation hubs. That sounds like it would be a major problem in the middle of tariff issues, which is one of the reasons why the stock is down around 20% from its 52-week highs. This drop, however, has pushed the dividend yield up to an attractive 3.9%. That is near the highest level in a decade.

Prologis has increased its dividend annually for 12 years. And while it could be hurt by the tariff side of the geopolitical turmoil, international trade isn't going to stop. It is far more likely that trade lines shift and that well-located warehouses remain in high demand. In other words, the uncertainty today is an opportunity for long-term investors to buy the industry leader in a still important REIT segment.

3. AvalonBay provides a life necessity

AvalonBay (NYSE: AVB) is the largest apartment REIT by market capitalization. Its dividend yield today is around 3.4%. That's the lowest on this list, but apartment REITs tend to have modest yields. That yield is kind of middle of the road for AvalonBay, which is often afforded a premium over its peers. The dividend hasn't been increased every year but has trended steadily higher for decades.

There are two big reasons to like AvalonBay. First, even in difficult periods people need a place to live. Thus, the REIT provides a necessity. Second, AvalonBay has a long history of deftly managing its portfolio through good and bad markets. That includes shifting between buying, selling, and building assets depending on which will provide the highest returns.

And management has also shifted its geographic positioning along with demand trends, with the current effort being building new apartments in the Sun Belt region. If you favor industry leaders, AvalonBay is the apartment giant you'll want in your portfolio now and, likely, for years to come.

Go with the biggest and best if you are looking for dividend stocks

When times get tough, it is usually a good choice to focus on industry leaders. That said, the REIT sector offers a large number of large, industry-leading companies because of the various unique property niches in the sector. Given the high yields REITs offer, that makes this sector a brilliant area to look at for opportunities. And industry leaders Realty Income, Prologis, and AvalonBay are all great starting points.

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Reuben Gregg Brewer has positions in Realty Income. The Motley Fool has positions in and recommends Prologis and Realty Income. The Motley Fool recommends AvalonBay Communities and recommends the following options: long January 2026 $90 calls on Prologis. The Motley Fool has a disclosure policy.

3 Brilliant Dividend Stocks to Buy Now and Hold for the Long Term was originally published by The Motley Fool

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