When it comes to investing, some frenetic traders think holding a stock for a year or two is considered "long term." But for many small-time investors, a year or two is just the start of the journey.
After all, countless research has been done into the perils of trading too much and either racking up significant underperformance or simply driving up your costs in fees and taxes. It can be much better to follow the lead of investing icon Warren Buffett, who famously quipped at one Berkshire Hathaway shareholder meeting that "our favorite holding period is forever." If you're interested in the really long haul, consider the following dividend stocks to buy and hold forever.
If you're interested in financial stocks as a play on economic growth, consider one of these top exchange-traded funds as a simple way to gain exposure to the sector.
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9
Dividend Stocks to Buy
and ETFs
and Hold Forever
The following nine companies are all valued at more than $100 billion and offer substantial current yields of more than 2% in addition to long-term stability.
These companies have delivered solid returns to the legendary Oracle of Omaha.
Warren Buffett likes these 3 stocks
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Warren Buffett,
The biggest of the big banks, financial powerhouse JPM isn't going anywhere anytime soon. It's a full-service leader, offering consumer and small-business banking as well as wealth management services and high-end services for corporations and institutions.
In other words: As long as there is money, JPMorgan will be there to help people make transactions – and take a small cut for the price of doing business.
And lest you fear the fallout of a global financial crisis in the decades to come, it's important to remember that JPM navigated the 2008 downturn much better than many of its peers and remains one of the best-run financial stocks in the world, thanks to the shrewd leadership of CEO Jamie Dimon.
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JPMorgan Chase & Co.
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Current yield: 2.5% Market capitalization: $482 billion
Founded more than 130 years ago, JNJ has a rich history and a dominant name in the health care sector.
Whether you are looking at consumer-focused products such as Band-Aid or Tylenol, its lucrative oncology drugs or its best-in-class digital medical devices for operating rooms, this health powerhouse has a lot of things going for it.
Perhaps the most compelling fact of all, however, is that Johnson & Johnson has the balance sheet to back up its brand power. Consider that alongside Microsoft Corp. (MSFT), JNJ is one of just two AAA U.S. stocks when it comes to debt ratings. Or that the company has increased its already generous dividend once a year for a whopping six decades running. If you want a long-term bet, it's hard to find any better than JNJ.
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Johnson & Johnson
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Current yield: 2.7% Market capitalization: $422 billion
health care sector.
These five names in the healthcare sector all come with yields of 3% or more.
5 healthcare stocks with high yields
Johnson & Johnson’s Breakup: What to Know
The health-products company is breaking up into two publicly traded companies.
Procter & Gamble (PG) is the firm behind some of the biggest consumer names on the planet, from Gillette shaving products to Pampers diapers and Crest toothpaste.
Chances are you likely have a medicine cabinet or dresser drawer featuring P&G products, and chances are that the next time you go to the store you're going to keep buying the same tried-and-true brands.
Procter & Gamble has increased its dividends at least once a year for roughly 65 years and has been in operation for just shy of two centuries. It's not a glamorous or high-growth business to peddle consumer staples, but it certainly is reliable for investors who are taking the very long view of their portfolios.
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Procter & Gamble Co.
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Current yield: 2.5% Market capitalization: $343 billion
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Coca-Cola Co.
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KO stock has long been a favorite of investing icon Warren Buffett and for good reason.
What's more, KO has looked beyond its flagship Coca-Cola soft drinks with juices, teas and "hydration" products including PowerAde and Smartwater to ensure it remains relevant for many years to come.
It also boasts roughly 60 years of consecutive dividend increases under its belt as a sure sign to income-oriented investors that they'll keep getting rewarded if they maintain this stock as a long-term holding.
Current yield: 3.1% Market capitalization: $234 billion
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Verizon Communications Inc.
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Verizon (VZ) is perhaps as close to a sure thing as you'll be able to find on Wall Street these days. The company boasts massive scale with more than $130 billion in annual revenue from millions of wireless, broadband, fiber optic and cable TV connections.
It has a near duopoly in the U.S. with fellow telecom giant AT&T Inc. (T) and a high barrier to entry from any future competition, thanks to the very expensive and regulated nature of building a telecom network.
And to top it all off, VZ is only paying about half of its operating profits as dividends – so even without future growth, there is plenty of headroom for future increases. About the only reason to doubt that Verizon will be around forever is if you expect the entire global communication system to collapse. And if that happens, you have bigger problems than your retirement account balance!
Current yield: 5% Market capitalization: $211 billion
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Cisco Systems Inc.
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A $232 billion leader in enterprise computing, Cisco (CSCO) is a Silicon Valley icon that has established itself as one of the dominant forces in the tech sector.
While it has had plenty of false starts over the years including some weird forays into consumer technology with products like its Flip camcorder, the company has withstood the test of time as its business has grown – and its dividend with it.
Specifically, payouts began in 2011 at 6 cents quarterly per share, and have increased dramatically over the last decade to 37 cents per share in 2021. The company has the wind at its back right now, too, setting a new 52-week high in September and looking up in the short-term even as it boasts a business that is clearly built to last.
Current yield: 2.7% Market capitalization: $232 billion
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McDonald's Corp.
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An icon of the restaurant industry, McDonald's (MCD) is also a case study in a company that knows how to drive long-term shareholder value. Its dividend has grown impressively over time with more than 40 years running of at least one dividend increase per year.
The size of those increases is significant, too, with a payout of 61 cents in 2011 growing to more than double that at $1.29 per quarter now. While there's certainly a focus on healthier eating, the cost-conscious and always convenient menu of McDonald's continues to connect with consumers.
And with recent expansion into delivery and loyalty programs, you can expect this stock to continue its track record of success for the foreseeable future.
Current yield: 2.3% Market capitalization: $180 billion
restaurant industry,
A healthy consumer appetite suggests that restaurant stock prices might soon catch up to expenses.
4 restaurant stocks to watch
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Pfizer Inc.
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Most recently making a name for itself in part because of its leading COVID-19 vaccine, PFE is a health care powerhouse that has what it takes to remain relevant in any market environment.
The pandemic is a great example of this drugmaker's innovative potential, and existing blockbusters – including its Prevnar pneumonia vaccine, Ibrance breast cancer drug and and Eliquis blood thinner – continue to power great long-term results.
One thing that's certain in life is that we all grow old and get sick, so a company like Pfizer with a strong track record and impressive global scale is a great long-term bet for dividend investors who want to set it and forget it.
Current yield: 3.8% Market capitalization: $235 billion
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Intel Corp.
Multinational technology giant Intel (INTC) makes the processors you find in most personal computers, but don't think this is a company that isn't fit for a 21st century marketplace.
It also specializes in cloud data infrastructure products and chips used in the Internet of Things via smart devices in the household. The company is certainly in flux after an announcement that it would restructure operations and create two new business lines focusing separately on software and high-performance hardware.
There are also rumors about Intel pulling back from the complex and lower-margin business of manufacturing chips, instead focusing on designs to outsource production. But at the end of the day, Intel is an icon of the tech sector with some of the most popular chips in history and a will to develop the next generation of processors.
Current yield: 2.7% Market capitalization: $212 billion
tech sector
Here are seven top tech dividend stocks to buy with yields of 2% or better at present.
7 tech dividend stocks to consider
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Dividend stocks to hold forever:
JPMorgan Chase & Co. (JPM) Johnson & Johnson (JNJ) Procter & Gamble Co. (PG) Coca-Cola Co. (KO) Verizon Communications Inc. (VZ) Cisco Systems Inc. (CSCO) McDonald's Corp. (MCD) Pfizer Inc. (PFE) Intel Corp. (INTC)
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