Overlooked Analyst-Approved Dividend Plays You Can Count On
Stability is at the top of the list of traits investors look for in dividend stocks, regardless of the sector or industry. The go-to dividend plays of long-term buy-and-hold strategists are not flashy companies or those in red-hot industries, but rather "boring" firms with a proven track record of consistency, even in difficult markets or economic climates.
That's not to say, though, that there aren't often-overlooked names that may fit this bill.
Investors may hesitate to pick a relatively unknown company as a dividend play, as a household name may indicate a firm's consistent and lengthy history.
However, in each of the cases below, a majority of Wall Street analysts view the company favorably. Two of the three even have non-marginal upside potential, according to analysts. This may make these companies worthy of consideration for investors seeking a dividend haven.
Strong Utilities Reach and Earnings Growth Fuel Essential's Dividend Increase
Providing water, wastewater, or natural gas services to millions across most regions of the United States, Essential Utilities Inc. (NYSE: WTRG) may be better known to some by its brands Aqua and Peoples. Utilities firms are a common target among dividend investors anyway—their services tend to be in demand regardless of season or market conditions, helping to ensure a steady dividend—but a firm with the geographic and operational diversification of Essential has an advantage even across the sector.
This structural benefit has provided Essential a win in the latest earnings season, when the company came in above predictions for both revenue and EPS, thanks to its gas and water businesses. A 35% year-over-year (YOY) increase in GAAP EPS is also partly thanks to Aqua's high efficiency and the company's expansion efforts in Texas.
However, perhaps the most attractive recent Essential news for dividend investors is the company's announcement of a 5.25% increase to its dividend, ensuring the continuation of a tradition of more than three decades of dividend increases.
The company pays a competitive 3.50% dividend yield and has a sustainable payout ratio of 58.8%. Essential appears poised to continue to grow its earnings, so investors may be able to count on a steady stream of dividend income alongside those gains.
Earnings Gains and Share Buybacks Drive Value for Globe Life
Insurance firms are another common position in dividend portfolios, and Globe Life Inc. (NYSE: GL) may warrant a place among larger rivals. This provider of life and supplemental health insurance, annuities, and related products is relatively small, with a market cap of only $11 billion. Still, its 125-year history and strong income performance help it to stand out for its dividend potential.
Globe Life's net operating income of $271 million for the latest quarter marks a 10% YOY improvement as the company's direct-to-consumer channel improved its underwriting margin at the same time. The company also raised its full-year earnings guidance in a show of optimism about the coming quarters.
In addition to its strengthening performance, Globe Life has taken numerous steps to increase shareholder value—the company spent about $226 million in share buybacks in the second quarter alone and is aiming for up to $650 million in repurchases across 2025.
It's also seeking as much as $200 million in new free cash flow through a Bermuda reinsurance vehicle.
The firm's dividend yield of 0.77% is lower than Essential's. Still, its low dividend payout ratio of 8.63% suggests that the company is well positioned to continue a steady flow of dividend payments for a long time to come.
A Gaming Giant With a Surprising Dividend History
While NetEase Inc. (NASDAQ: NTES), an online gaming, streaming, and intelligent learning services firm, is the only stock on this list with potential downside (-9.5%), most analysts still see shares as a Buy.
Despite this, the company's games segment has been a success, driven largely by blockbuster titles like Marvel Rivals.
It may surprise investors that a company in this industry has more than a decade of history of consistent dividend payouts.
The firm has a dividend yield of 1.98% and a payout ratio of 36.4%, suggesting that its distributions remain a healthy portion of its overall financial activities.
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