We recently published a list of the 15 Best High-Yield Dividend Stocks for 2025 and Beyond. In this article, we are going to take a look at where Exxon Mobil Corporation (NYSE:XOM) stands against other best high-yield dividend stocks.
Over the years, dividend-paying stocks have become increasingly popular as investors lean toward income-focused investment strategies. Many conservative investors have committed hundreds of billions of dollars across numerous funds based on the belief that companies with a consistent track record of raising dividends tend to deliver the strongest long-term market performance.
According to Ed Clissold of Ned Davis Research, over 80% of companies in the broader market currently pay dividends, and 324 of them have either initiated or increased their payouts over the past year. Interestingly, it was earlier research by Clissold’s firm that helped spark the widespread interest in dividend-growing stocks. That study, based on an older return calculation method that has since been widely replicated, highlighted the strong performance of companies that regularly increased their dividends.
However, as the firm has updated its methods to align with changes in the industry, the findings suggest that while dividend growers have performed well, focusing on high-yielding dividend stocks may be even more rewarding. This yield-based strategy has outperformed dividend growers in both rising and falling markets since 1973. Financial advisers suggest that investors start by examining a stock’s dividend yield, which is determined by dividing the annual dividend by the stock’s current price. This figure indicates the income an investor earns for every dollar put into the stock.
However, high dividend yield tends to come with higher volatility and more frequent portfolio turnover. It isn’t always a positive sign. It can sometimes signal trouble, especially if it’s driven by a drop in the stock’s price. In these situations, there’s a risk that the company may reduce its dividend payments—something that often happens during periods of financial strain. Advisers emphasize the need to go beyond surface-level metrics and examine a company’s core financials to assess its overall stability and strength. Jason Alonzo, managing director at Harbor Capital Advisors, made the following comment about investing in dividend stocks:
“Make sure the company has a strong balance sheet and its prospects for earnings-per-share growth are strong, so the company is well-positioned to maintain dividend payments in the future even if there is a recession.”
While the debate between dividend growth and high yield continues, analysts emphasize that dividend-paying stocks are not all created equal. Stocks that offer a solid yield along with steady dividend increases often reflect strong fundamentals, as they suggest the company can reward shareholders while still investing in future growth. The dividend payout ratio plays a critical role in assessing a company’s flexibility with its dividend policy. Firms that use nearly all of their earnings to cover dividends—or barely earn enough to sustain them—might face challenges, especially when under competitive pressure, due to limited cash flow for operational support.
Exxon Mobil Corporation (XOM): Among the Best High-Yield Dividend Stocks for 2025 and Beyond
Aerial view of a major oil rig in the middle of the sea, pumping crude oil.
Our Methodology:
For this article, we used a screener to identify dividend companies with above-average dividend yields. From there, we picked companies that have raised their payouts for at least 10 consecutive years, which shows their long-term growth. Finally, we picked 15 stocks with the highest dividend yields, as of May 9, and ranked them accordingly.
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Exxon Mobil Corporation (NYSE:XOM) is an American multinational oil and gas company. The company is a major force in the global oil and gas industry, with a premier portfolio of assets. It is one of the world’s largest integrated companies in fuels, lubricants, and chemicals. The company operates facilities and markets products around the globe, while also conducting oil and gas exploration on six continents.
For the first quarter of 2025, Exxon Mobil Corporation (NYSE:XOM) posted revenue of $83.1 billion, marking a slight year-over-year increase of 0.06%, though it narrowly missed analysts’ projections by $3 billion. On the other hand, earnings per share reached $1.76, surpassing expectations by $0.02. Since 2019, Exxon Mobil has pursued a strategy centered on cost reduction, growing its most profitable volumes, and improving efficiency. These efforts have strengthened quarterly earnings by roughly $4 billion based on current market conditions. In 2025, it plans to bring 10 high-return projects online, projected to add over $3 billion in earnings by 2026 if prices and margins remain steady.
During the quarter, Exxon Mobil Corporation (NYSE:XOM) generated $13.0 billion in operating cash flow and $8.8 billion in free cash flow. In keeping with its stated capital return program, it returned $9.1 billion to shareholders, $4.3 billion through dividends and $4.8 billion via share buybacks. It is one of the best dividend stocks on our list as the company has been rewarding shareholders with growing dividends for the past 41 consecutive years. Currently, it offers a quarterly dividend of $0.99 per share and has a dividend yield of 3.69%, as recorded on May 9.
Overall, XOM ranks 12th on our list of the best high yield dividend stocks. While we acknowledge the potential of XOM as an investment, our conviction lies in the belief that some deeply undervalued dividend stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued dividend stock that is more promising than XOM but that trades at 10 times its earnings and grows its earnings at double digit rates annually, check out our report about the dirt cheap dividend stock.
