One huge lesson I’ve learned during the past quarter century is that time is a dividend investor’s best friend. It’s possible to build life-changing wealth if you pick stocks that represent solid businesses, accumulate shares, and consistently reinvest the dividends for many years.
The secret sauce here isn’t to chase after stocks that pay the highest dividend yields. Rather, it’s getting good yield while also focusing on companies that are growing their sales, income, or both.
Thus, I’ve developed a dividend investing strategy over the past 25 years that emphasizes financially firm businesses instead of gigantic yields. So, feel free to add these rock-solid dividend deliverers to your buy-and-hold portfolio today.
Lockheed Martin (LMT)
As long as we live in an uncertain world, there will always be a need for national defense infrastructure. Consequently, I’ve counted on Lockheed Martin (NYSE:LMT | LMT Price Prediction) stock as a mainstay of my dividend-paying portfolio.
Defense contractor Lockheed Martin is a financially solid company, I believe, because the company’s top-line and bottom-line results are moving in the right direction. Specifically, Lockheed Martin grew its first-quarter 2025 sales by 4% year over year to $17.963 billion and its net earnings by 10.8% to $1.712 billion.
Unless you expect the world to live in complete peace and harmony, it makes sense to add some Lockheed Martin shares to your portfolio. Currently, the company offers a forward annual dividend yield of 2.79%.
Imagine how those dividend distributions can enhance your wealth over time if you continue to reinvest them. Actually, you don’t have to imagine it because I’ll now use a historic dividend reinvestment returns calculator to show you what the results can look like.
If you had invested $10,000 in Lockheed Martin stock at the beginning of the year 2000 and not reinvested the dividends, you would have grown it to $297,011.60. Yet, if you had reinvested the dividends over those 25 years, you would have grown your LMT stock investment to $441,649.89. Clearly, a minor adjustment to your strategy can make a huge difference over time.
Coca-Cola (KO)
What could possibly be more refreshing than an ice-cold soda from beverage giant Coca-Cola (NYSE:KO)? My answer would be: a distribution of cold, hard cash in your portfolio from Coca-Cola, a consistent dividend payer for many years.
As a business, Coca-Cola has stayed financially reliable through good and bad times. For instance, in 2025’s first quarter (which included some broad-market volatility), Coca-Cola grew its organic revenue by 6% year over year and increased its earnings per share (EPS) by 5% to $0.77.
What if you had invested $10,000 in KO stock at the beginning of this century? It would have been a good decision since, without reinvesting the dividends, that $10,000 would have turned into $35,271.43 by now.
Reinvesting all of the dividend distributions would have been even better, though. That strategy would have grown your investment to $51,274.26, believe it or not. Today, Coca-Cola provides a 2.84% forward annual dividend yield, so don’t hesitate to take a sip of these delicious distributions in 2025.
Dominion Energy (D)
Throughout the ups and downs of the economy, people will undoubtedly continue to use electricity. That’s why I’ve counted on Dominion Energy (NYSE:D) to continue generating revenue and delivering dividend payments during the past 25 years.
Dominion Energy is a large utilities company with a firm financial foothold. In Q1 of 2025, the company grew its operating revenue to $4.076 billion from $3.632 billion in the year-earlier quarter. In that same time frame, Dominion Energy increased its net income from $0.50 per share to $0.75 per share.
Going back to the beginning of January 2000, a simple policy of holding Dominion Energy stock without reinvesting the dividends would have turned $10,000 to $58,013.69. That’s nothing to sneeze at, but if you had reinvested all of the dividends, that same $10,000 would have ballooned to $84,120.94.
The historic returns have been amazing, but is it too late to electrify your returns with Dominion Energy stock in 2025? No way! If you want to try out my strategy of investing in financially solid businesses and reinvesting the cash distributions, feel free to purchase shares of Dominion Energy along with Lockheed Martin and Coca-Cola.
While you’re at it, check out some other established dividend champions like Kimberly-Clark (NYSE:KMB) (with a forward annual dividend yield of 3.58%), Archer Daniels Midland (NYSE:ADM) (4.08%), Bank of America (NYSE:BAC) (2.32%), and Home Depot (NYSE:HD). With ultra-reliable names like these in your portfolio, you can look forward to a fantastic future of outstanding, dividend-driven returns.
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