Top 5 Dividend Stocks To Weather The Storm

Seeking Stability in the Wake of ‘Liberation Day’

The past week has been marked by intense market volatility driven by President Trump’s aggressive tariff measures, including a 10% base levy on all imports and additional customized tariffs on individual countries.

 

Source Link: SA Analyst Danil Kolyako

The S&P 500 plunged more than 6%, its worst weekly losses since the pandemic, while the Dow entered a correction, and the Nasdaq neared bear-market territory. Investor sentiment was further shaken by fears of a global recession as China retaliated with a 34% tax on U.S. imports, to which Trump responded by threatening an additional 50% tariff on Chinese imports. Major sectors saw steep losses, particularly tech (XLK), which shed nearly 6% last Friday alone.

 

Source Link: Bloomberg

While current market volatility reflects the scale of the trade shock, long-term inflation also poses a key risk to investors; newly imposed tariffs could cause inflation to rise 5%. I have been cautioning investors about market turbulence since January 10th, in my article, The Best Defensive Stocks To Hedge Against Market Uncertainty. Tariffs directly increase the cost of imported goods, which businesses typically pass on to consumers through higher prices. They can also reduce competition from foreign producers, allowing domestic producers to inflate their prices without suffering consequences. Historically, the introduction of tariffs has had negative repercussions for markets, which have underperformed in tariff-launch years.

 

Between Presidents Herbert Hoover, Richard Nixon, George W. Bush, and Donald Trump’s first term, the broad-market index averaged -14.5%. While tariffs were not solely responsible for some of these recessions, they certainly didn’t help in the economic recovery.

The administration’s messaging on whether or not the tariffs are negotiable has been mixed. Trump dismissed the idea of putting a pause on tariffs like he did earlier this year, with the 10% levy having gone into effect this past Saturday. However, the administration has also signaled it is open to striking trade deals amid market volatility.

If tariffs are here to stay, investors could face a potentially long, uphill battle against inflation in addition to market upheaval. Speaking at the Society for Advancing Business Editing and Writing conference, Fed chair Jerome Powell acknowledged the inflationary pressures on the horizon:

“While tariffs are highly likely to generate at least a temporary rise in inflation, it is also possible that the effects could be more persistent. Avoiding that outcome would depend on keeping longer-term inflation expectations well anchored, on the size of the effects, and on how long it takes for them to pass through fully to prices.”

This uncertain market environment leaves investors questioning where exactly we are in the downturn cycle, as many remain paralyzed by indecision about whether to buy the dip, cut their losses, or simply wait until clearer economic signals emerge. We examined historical data related to financial crises spanning 1980 to 2025. Based on historical patterns, markets enter a correction approximately every 3.2 years, with a median pullback period of 173 days. Currently, we’re about 49 days into the current pullback. If this correction follows the median historical timeline, we would reach the expected recovery point around August 9, 2025 – though recovery could potentially occur earlier.

How Long Could the Downturn Last?

 

If history is correct, investors will likely want to seek lower-volatility assets to ride out the uncertainty in the coming months. Below I will detail why dividend-paying stocks are primed for our current moment.

Beating Back Inflation with Dividend Stocks

In times of market turbulence, dividend-paying stocks are a critical portfolio stabilizer, offering a reliable income stream alongside growth potential. We have seen a steady flight to dividend-paying stocks since volatility kicked off in February, with the Vanguard Dividend Appreciation Index Fund ETF Shares (VIG) netting over $200M in flows YTD. The first three days of April alone saw $80M in net inflows.

Market Turbulence is Driving Dividend Flows in 2025

 

Source Link: ETF.com

In addition to providing income, dividend-paying stocks often exhibit lower volatility, as companies that pay dividends are typically more established and financially stable. This can result in less extreme price volatility and help de-risk a portfolio.

Importantly, dividend stocks function as a key tool to help combat inflation, providing payouts that grow over time. Reinvesting dividends can compound returns, helping investors maintain purchasing power despite inflationary pressures.

Top 5 Dividend Stocks to Weather the Storm

Given the current market environment, SA Quant has explored its universe of top dividend stocks with Quant Strong-Buy recommendations and excellent factor and dividend grades. This universe of 27 stocks delivers an average FWD Yield of 3.85% vs. the S&P 500’s 1.42% and has strongly outperformed the S&P 500, returning -4.33% vs. -14.00% YTD.

Within this universe of stocks, we have detailed five great options for investors. This narrower basket of five stocks has an average dividend yield of 4.25%, well above the 1.42% for the S&P 500 and 2.00% for Vanguard Dividend Appreciation Index Fund ETF Shares. Additionally, these stocks have returned on average 3.82% YTD vs. the S&P 500’s -14.00% and -13% for the VIG.

Top 5 Quant Dividend Stocks Have an Average FWD Yield of 4.25% vs. the S&P 500’s 1.42% and have outperformed the S&P 500 by Roughly 18% YTD.

 

These stocks were evaluated along multiple dividend grades, including safety and growth. The dividend safety grade leverages a sophisticated data-driven approach to offer a reliable assessment of a company’s ability to keep paying its dividends and avoid dividend cuts.

Dividend Cuts Can Be Avoided With Strong Dividend Safety Grades

 

Similarly, the dividend growth grade provides an instant characterization of a company’s ability to grow its dividends based on data-driven analysis. This tool is valuable for income-focused investors who want to pinpoint companies with better dividend growth potential.

 

Note that because these stocks were holistically evaluated across factor and dividend grades, they do not represent the highest-yielding dividend stocks. Instead, they are a combination of dividend yield, safety, and growth, in addition to high factor grades and a Quant “Strong Buy” recommendation.

1. Tyson Foods, Inc. (TSN)

• Market Capitalization: $21.30B
• Sector: Consumer Staples
• Industry: Packaged Foods and Meats
• Quant Sector Ranking (as of 4/7/25): 5 out of 182
• Quant Industry Ranking (as of 4/7/25): 1 out of 54
• Quant Rating: Strong Buy
• FWD Yield: 3.34%

TSN is the #1 Quant-ranked Packaged Foods and Meats stock with a diverse portfolio of several iconic brands including Tyson, Jimmy Dean, Hillshire Farm, and Ball Park. While best known for its flagship Tyson chicken brand, the company operates across multiple animal protein categories and prepared foods, serving both retail and food service categories. Tyson’s 2025 fiscal year is off to a strong start, with a Q1 adjusted EPS rising 65% Y/Y driven by record performance in its chicken segment. The company’s solid ‘A’ Growth grade is also supported by excellent forward-looking metrics, including a FWD EBITDA Growth that is more than 250% above the sector median, as well as an EPS Diluted Growth FWD of 45% vs. the sector’s 7%.

TSN Growth Grade

 

TSN offers a compelling valuation in addition to its growth, trading favorably across key metrics like its FWD Price/Book, which stands at a 61% discount to the sector median. Additionally, TSN offers a four-year average dividend yield that is 15% higher than the median consumer staples stocks. In Q1FY25, the company raised its quarterly payout to $0.50 per share, marking the 13 consecutive annual dividend hike.

TSN Dividend Consistency Grade

 

Tyson’s focus on operational excellence and strategic optimization of its supply chain should continue to help the company generate free cash flow, allowing for growth while maintaining dividend commitments. With eight FY1 up revisions in the last 90 days versus zero downward revisions, Tyson has been endorsed as a high-quality company for dividend-focused investors. We have many Top Consumer Staples stocks rated Strong Buy.

2. Alexander & Baldwin, Inc. (ALEX)

• Market Capitalization: $1.20B
• Sector: Real Estate
• Industry: Diversified REITs
• Quant Sector Ranking (as of 4/7/25): 3 out of 173
• Quant Industry Ranking (as of 4/7/25): 1 out of 14
• Quant Rating: Strong Buy
• FWD Yield: 5.44%

Alexander & Baldwin, Inc. is a Hawaii-focused REIT specializing in commercial real estate and land operations. ALEX reported strong leasing activity, executing 47 leases covering over 140,000 square feet in Q4. Additionally, ALEX began construction on a 30,000-square-foot industrial asset at Maui Business Park to support long-term growth. The company boasts an AFFO FWD Growth of that is more than 175% above the sector, while its FWD Operating Cash Flow Growth stands at 10.26% vs. the sector’s 5.40%.

 

Source Link: ALEX Q4 2024 Investor Presentation

Operational efficiency remains a key focus for the company. In 2024, ALEX reduced general and administrative expenses by 12.4% and lowered carrying costs in its land operations segment. These gains are reflected in ALEX’s stellar profitability metrics, including an FFO interest coverage ratio of that is more than 80% above the sector. ALEX also boasts an FFO to Gross Margin of 90% vs. the sector’s 64%.

The company’s 5.45% FWD yield has a strong track record for growth; the company’s Dividend Growth Rate 10Y of 19% vs. the sector’s 1.76%. This is dovetailed by solid dividend safety, with an impressive FFO margin of 91%.

With its strong growth trajectory, operational gains, and focus on Hawaii’s resilient CRE market, ALEX represents an excellent option for dividend-focused investors seeking steady income and long-term growth potential through REITs. SA Quant ranks many other Top Real Estate stocks.

3. The Clorox Company (CLX)

• Market Capitalization: $17.72B
• Sector: Consumer Staples
• Industry: Household Products
• Quant Sector Ranking (as of 4/7/25): 4 out of 182
• Quant Industry Ranking (as of 4/7/25): 1 out of 13
• Quant Rating: Strong Buy
• FWD Yield: 3.39%

CLX is the #4 Quant-ranked Consumer Staples stock and ranks among the top 10 U.S. stocks with strong growth and dividends according to SA Quant metrics. In Q2 FY2025, the company grew market share in seven out of eight categories, supporting the company’s ‘A’ Growth grade, with excellent forward-looking earnings. FWD EBITDA growth is 9%, while FWD EPS growth is an 13%, both of which are an incredible 65% and 88% above the sector median, respectively.

CLX Growth Grade

 

CLX has an ‘A+’ Profitability Grade with highlights including a TTM EBITDA margin that is 34% above the sector median and $2.35 in cash per share compared with the sector’s $1.83. These metrics have also contributed to the company’s ‘A’ Dividend Growth grade, which is accompanied by solid Dividend safety. While the stock’s overall valuation profile is not as strong as its growth and profitability, CLX is trading at an incredible -90% discount to the sector with regard to its TTM PEG ratio. In addition to excellent fundamentals, Clorox has been endorsed by Wall Street, with 19 FY1 upward EPS revisions in the last 90 days and zero down revisions. CLX is a solid choice for a Consumer Staples play in a period when the sector is gaining traction.

4. Philip Morris International Inc. (PM)

• Market Capitalization: $234.19B
• Sector: Consumer Staples
• Industry: Tobacco
• Quant Sector Ranking (as of 4/7/25): 11 out of 182
• Quant Industry Ranking (as of 4/7/25): 3 out of 8
• Quant Rating: Strong Buy
• FWD Yield: 3.59%

PM is a prominent global producer of tobacco and smoke-free products. Despite declining cigarette volumes, PM has successfully expanded into the explosively popular nicotine pouch market with its acquisition of ZYN manufacturer Swedish Match in 2022. PM saw ZYN shipments increase 41% Y/Y in 2024 and the company’s smoke-free portfolio now accounts for 40% of total net revenue. PM projects double-digit growth for smoke-free products in 2025 supported by expanded production capacity. PM’s growth in this segment is driving robust profitability, with a TTM EBITDA Margin that is more than 200% above the consumer staples sector median, coupled with an incredible $12.22B in Cash from Operations.

PM Profitability Grade

 

The company has exhibited powerful price momentum over the last year, returning 67%, which has taken a toll on the company’s valuation. However, PM is still trading broadly in line with the sector across key metrics like its FWD PEG ratio of 2.2x. PM currently offers investors a four-year average dividend yield that is 96% above the sector median while displaying a strong interest coverage ratio of 7.5x, contributing to stellar dividend safety. With 16 consecutive years of dividend growth, income-oriented investors should take a look at this company, which shows huge potential for capital appreciation alongside its dividend appeal.

5. NETSTREIT Corp. (NTST)

• Market Capitalization: $1.25B
• Sector: Real Estate
• Industry: Retail REITs
• Quant Sector Ranking (as of 4/7/25): 13 out of 173
• Quant Industry Ranking (as of 4/7/25): 2 out of 23
• Quant Rating: Strong Buy
• FWD Yield: 5.50%

NETSREIT is the #2 Quant-ranked Retail REIT with a focus on properties with high-quality, credit-worthy tenants that provide essential goods like grocery stores, pharmacies, and discount retailers. The company uses a ‘net lease’ model where tenants are responsible for most property expenses like insurance and maintenance. Diversified across 687 properties, NTST sources 71% of its Annualized Base Rent from investment-grade or investment-grade profile tenants, which helps to minimize risk and ensure stable cash flows. This prudent approach is reflected in the company’s ‘B+’ Profitability Grade, undergirded by an exceptional AFFO Margin which is 62% above the sector median.

 

Source Link: NETSREIT Q4 2024 Investor Presentation

In Q4, NTST achieved record gross investments at attractive yields, contributing to its ‘A+’ Growth Grade. The company sports an AFFO Growth (3Y Hist. CAGR) of 10.26% which is 125% above the REITs sector, alongside a FWD Operating Cash Flow Growth of 16% vs. the sector’s 5%.

With respect to valuation, the company trades at a discount along several key metrics, including a FWD Price/AFFO that is -18% lower than the REITs sector. NTST’s attractive FWD yield of 5.50% is complimented by an exceptional ‘A-’ Dividend Growth Grade; the company’s TTM Dividend Growth rate is nearly 40% above the sector median. NTST’s also ranks highly in terms of dividend safety, posting a FWD AFFO payout ratio that is more than 10% below the REITs sector.

NTST Dividend Yield Grade

 

NETSREIT is a diversified, profitable, growth-oriented REIT still trading for decent value with a fantastic dividend profile for income-focused investors.

Additional Top Quant Dividend Stocks

We recognize investors may want a greater variety of top Quant dividend stocks given the current moment. We have listed five more tickers below, a “dealers choice” of high-quality dividend-paying that span more sectors and industries.

Additional Five Top Quant Dividend Stocks

 

Conclusion

In this period of extreme market turbulence, investors can complement long-term portfolios, hedge inflation, and minimize risk by investing in dividend stocks that deliver consistent growth and are less prone to dividend cuts. SA’s Quant Team used its Dividend Grading System to identify five high-quality dividend stocks with an average FWD yield of 4.25%. There are many SA Quant Strong Buy Top Dividend Stocks with excellent Dividend Grades. These stocks offer the potential for capital appreciation and income generation, as well as, providing a possible hedge to weather the downturn in the markets.

The stocks featured here can help complement a diverse portfolio. Alternatively, consider exploring Alpha Picks if you’re seeking a limited number of Seeking Alpha Quant’s best monthly ideas from the hundreds of top quant Strong Buy-rated stocks. If you prefer to rely on investment professionals for stock recommendations, Alpha Picks is a service that identifies high-quality opportunities using a systematic, data-driven approach. It targets stocks with strong financials, attractive valuations, and long-term growth potential, offering research-backed selections designed to help long-term investors outperform the market.

• I am Steven Cress, Head of Quantitative Strategies at Seeking Alpha. I manage the quant ratings and factor grades on stocks and ETFs in Seeking Alpha Premium. I also lead Alpha Picks, which selects the two most attractive stocks to buy each month, and also determines when to sell them.