As we turn the page to 2026, certain dividend stocks can become standout performers. Realty Income (NYSE:O | O Price Prediction), Verizon (NYSE:VZ), and Eastman Chemical (NYSE:EMN) have high yields and are well-positioned to give you upside alongside them.
They don’t catch headlines the way soaring tech stocks have done in the past few years, but that’s the same reason they will be able to outperform if the pendulum swings the other way next year.
Over the past 50 years, companies that regularly raised their payouts delivered more than twice the annualized total return of non-payers. They managed to do it with less volatility.
The yields are in the sweet spot where it’s sustainable and will become very attractive as interest rates go down, and the businesses themselves are solid cash cows with plenty of headroom to keep expanding. Let’s take a look.
Realty Income (O)
Realty Income is hands down the best monthly dividend stock you can go for. No other monthly payer offers anything close to what this company does. You get stability, a high yield, and good upside potential in the coming years.
The broader real estate industry has done much better than expected, as it survived the record interest rate hikes and is set to thrive as rates come down. Realty Income is also a hedge if investors turn sour on the broader AI rally.
The company buys and manages commercial properties that are mostly retail. Its customers are retailers like 7-Eleven, Dollar General (NYSE:DG), Walgreens, and Family Dollar. These customers themselves are very recession-resistant and have inelastic demand year-round.
Realty Income comes with a 5.72% forward yield. It has declared 666 monthly dividend payments and is a Dividend Aristocrat.
Verizon Communications (VZ)
Verizon is a well-known telecommunications company that has faced a rough couple of years since the interest rate hiking cycle began. Telecom companies are known for carrying heavy debt. In Verizon’s case, it carries $126.6 billion in long-term debt. This has led to $1.66 billion in interest expenses in Q3 2025 alone.
Verizon has managed to continue posting solid profits despite those interest expenses, while paying increasing dividends. Net profit margin was 14.64% in Q3 2025 with nearly $5 billion in net income.
It also has 20 consecutive years of dividend growth under its belt, with a payout ratio of just 57.68%.
Verizon has proven that customers no longer see communications services as a discretionary expense. The internet has turned into a necessity that consumers are willing to pay for. Thus, Wall Street is now increasingly seeing Verizon as a cash cow.
I believe VZ stock is set to deliver a full recovery like AT&T (NYSE:T) has done. Lower interest rates will make it a much more profitable business, and the AI buildout is also helping solidify Verizon’s reputation as a stalwart of the telecom industry.
VZ stock has a dividend yield of 6.85%.
Eastman Chemical (EMN)
Eastman Chemical is a lesser-known company, but it comes with an attractive dividend yield with plenty of upside potential on top. It is a specialty materials company that makes chemicals and fibers. The “industrial” characteristic can come in handy due to tariffs and onshoring, though tariffs are a reason why EMN stock is at a discount today.
Management built up a large inventory preceding tariff announcements, but this ended up overlapping with a lull in demand. As a result, both revenue and profits have cratered, but I only expect this to be a temporary phenomenon as demand rebounds.
EMN stock has only been this cheap during the trough of the 2020 crash and back in 2016. I see limited downside risk as it trades at just 10 times 2026 earnings.
Eastman comes with a 5.35% forward dividend yield, and dividends have been increasing for 16 consecutive years.
Top Gaining Stocks
Top Losing Stocks