In addition to profiting from ordinary trading activities, the stock market offers opportunities for investors seeking passive income through dividend payouts.
Notably, some stocks are set up to reward shareholders regularly. As the markets look ahead to 2025, several stocks can be tapped to offer passive income. Some of these companies have a history of stable dividends and consistent growth.
Therefore, below are three stocks to consider for a dividend-focused portfolio in 2025.
Johnson & Johnson (NYSE: JNJ)
A stalwart in the healthcare sector, Johnson & Johnson (NYSE: JNJ) has earned its reputation as a “dividend king” by raising its dividends for 60 consecutive years. The company’s diverse operations span pharmaceuticals, medical devices, and consumer health products, providing stability and growth potential.
Johnson & Johnson’s Q2 2024 performance underlined its financial strength, with sales growing by 4.3% to $22.4 billion, up from $21.5 billion in Q2 2023. This growth was driven by the success of its Innovative Medicine and MedTech divisions.
Key growth drivers included oncology treatments like DARZALEX and cardiovascular solutions like electrophysiology products from its MedTech segment. Furthermore, the healthcare giant recently updated its 2024 earnings guidance to reflect a more optimistic outlook due to the impact of strategic acquisitions such as Shockwave Medical and Proteologix.
This strong cash flow generation supports ongoing dividend payments, making the stock a reliable option for income-seeking investors.
JNJ was trading at $164 by press time, having rallied almost 3% in 2024.
JNJ YTD stock price chart. Source: Finbold
Realty Income (NYSE: O)
Realty Income (NYSE: O) stands out in the real estate sector as a Real Estate Investment Trust (REIT) specializing in single-tenant commercial properties. It has a remarkable record of increasing monthly dividends for years.
This consistency is supported by a high-quality tenant portfolio, making it less vulnerable to economic cycles than many other REITs. The company continues to expand its portfolio, focusing on high-traffic, essential retail locations that provide steady rental income.
As the real estate market stabilizes and recovers from recent economic challenges, Realty Income’s strategic growth approach further cements its status as a dependable income stock, making it an appealing choice for those looking for steady monthly income.
As things stand, O is valued at $61, reflecting a growth of 5.6% in 2024.
O YTD stock price chart. Source: Finbold
Procter & Gamble (NYSE: PG)
Another “dividend king,” Procter & Gamble (NYSE: PG), has consistently rewarded its shareholders with steady dividend growth, thanks to its strong position in the consumer staples sector. The company boasts a diverse portfolio of consumer goods ranging from household to personal care products, which remain in demand regardless of economic conditions.
This stability is enhanced by P&G’s ongoing focus on innovation and strong brand recognition, which drive sales growth and market leadership. With new product developments and a strategic push into emerging markets, Procter & Gamble has reinforced its growth prospects while maintaining a solid dividend payout policy.
This makes it an attractive option for investors seeking a balance of stability and growth potential in their income portfolios.
On a year-to-date basis, PG has rallied over 14%, trading at $170 by press time.
PG YTD stock price chart. Source: Finbold
Overall, although these stocks are facing a potentially uncertain future heading into 2025 due to persistent fears of a recession, they offer the potential for notable returns based on their history of paying dividends.
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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
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