2025's Five Highest Yielding Dogs of the Dow Could Explode Higher

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive
compensation for actions taken through them.

The ‘Dogs of the Dow’ is a well-known strategy first published in 1991 by Michael Higgins. The plan seeks to maximize the yield of investments by buying the ten highest-paying dividend stocks available from the Dow Jones Industrial Average each year. The highest-yielding stocks are also the lowest-priced stocks in the venerable average, as the lower a stock (or bond) goes in price, the higher the attached yield or coupon becomes.

24/7 Wall St. Key Points:

• The S&P 500 pulled of the first back-to-back 20%+ gains since the late 1990s
• The Dow Jones Industrial posted a solid but more modest 13.5% gain in 2024
• Wall Street expects another solid year for 2025, albeit with lower gains
• Are the Dogs of the Dow stocks right for you? Why not meet with a financial advisor near you and find out?

While technology and Artificial intelligence stocks are once again expected to lead the way in 2025, often the best place for growth and income investors to look after consecutive years of market outperformance is to the sectors that underperformed the previous year. Energy and healthcare underperformed in 2024, and while energy remains the top-performing sector since the 2020 COVID-19 recession, valuations in both sectors have dropped to very attractive levels.

We found it interesting that three of the Dow’s highest-yielding 2025 Dogs are healthcare leaders, while another is one of the top energy companies in the world. All five of the highest-yielding Dogs are rated Buy at many of the top Wall Street firms, and all make sense for 2025.

Why do we cover the Dogs of the Dow?

Since the turn of the century, the Dogs of the Dow have significantly outperformed the overall Dow Jones Industrials and the Small Dogs of the Dow, which are the five highest-yielding stocks, even more. The fact that investors are buying the highest-yielding companies in the venerable index improves the chances for total return gains.

Here are the five highest yielding Dogs of the Dow for 2025:

Verizon Communications

This top telecommunications company offers tremendous value and pays investors a 6.78% dividend. Verizon Communications, Inc. (NYSE: VZ), through its subsidiaries, provides communications, technology, information, and entertainment products and services to consumers, businesses, and governmental entities worldwide.

It operates in two segments:

• Verizon Consumer Group
• Verizon Business Group

The Consumer segment provides wireless services across the wireless networks in the United States under the Verizon and TracFone brands and through wholesale and other arrangements. It also provides fixed wireless access (FWA) broadband through its wireless networks and related equipment and devices, such as smartphones, tablets, smartwatches, and other wireless-enabled connected devices.

The segment also offers wireline services in Mid-Atlantic, Northeastern United States, and Washington D.C. through its fiber-optic network, Verizon Fios product portfolio, and a copper-based network.

The Business segment provides wireless and wireline communications services and products, including:

• FWA broadband
• Data
• Video and conferencing
• Corporate networking
• Security and managed network
• Local and long-distance voice
• Network access services to deliver various IoT services and products to businesses, government customers, and wireless and wireline carriers in the United States and internationally

Chevron

This integrated giant is a safer way for investors looking to position themselves in the energy sector. It pays a rich 4.50% dividend. Chevron Corporation (NYSE: CVX) engages in integrated energy and chemicals operations worldwide through its subsidiaries.

The company operates in two segments:

• Upstream
• Downstream

The Upstream segment is involved in the following:

• Exploration, development, production, and transportation of crude oil and natural gas
• Processing, liquefaction, transportation, and regasification associated with liquefied natural gas
• Transportation of crude oil through pipelines
• Transportation, storage, and marketing of natural gas, as well as operating a gas-to-liquids plant

The Downstream segment engages in:

• Refining crude oil into petroleum product
• Marketing crude oil, refined products, and lubricants
• Manufacturing and marketing renewable fuels
• Transporting crude oil and advanced products by pipeline, marine vessel, motor equipment, and rail car
  Manufacturing and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives

Chevron announced in the fall of 2023 that it has entered into a definitive agreement with Hess Corporation (NYSE: HES) to acquire all of the outstanding shares of Hess in an all-stock transaction valued at $53 billion, or $171 per share based on Chevron’s closing price on October 20, 2023. Under the terms of the agreement, Hess shareholders will receive 1.0250 shares of Chevron for each Hess share. The transaction’s total enterprise value, including debt, is $60 billion.

The US Federal Trade Commission approved Chevron’s purchase of Hess in October of last year but barred Hess CEO John Hess from joining Chevron’s board.

Amgen

This biotech giant remains a top stock for investors to buy and a safer way to play the massive potential growth in biosimilars while paying a solid 3.65% dividend. Amgen Inc. (NASDAQ: AMGN) discovers, develops, manufactures, and delivers human therapeutics worldwide.

Amgen focuses on:

• Inflammation
• Oncology/hematology
• Bone health
• Cardiovascular disease
• Nephrology
• Neuroscience

The company’s products include:

• Enbrel to treat plaque psoriasis, rheumatoid arthritis, and psoriatic arthritis
• Neulasta reduces the chance of infection due to a low white blood cell count in patients with cancer
• Prolia to treat postmenopausal women with osteoporosis
• Xgeva for skeletal-related events prevention
• Otezla for the treatment of adult patients with plaque psoriasis, psoriatic arthritis, and oral ulcers associated with Behcet’s disease
• Aranesp to treat a lower-than-normal number of red blood cells and anemia
• KYPROLIS to treat patients with relapsed or refractory multiple myeloma
• Repatha reduces the risks of myocardial infarction, stroke, and coronary revascularization

Johnson & Johnson

With a diverse product base and a familiar and solid brand, Johnson & Johnson (NYSE: JNJ) is among the most conservative big pharmaceutical plays and pays a rich 3.43% dividend. It is one of the top market-cap stocks in the healthcare sector and raised the dividend for shareholders last year for the 62st consecutive year.

The company’s Innovative Medicine segment offers products through retailers, wholesalers, distributors, hospitals, and healthcare professionals for prescription use for various therapeutic areas, such as:

• Immunology, including rheumatoid arthritis, psoriatic arthritis, inflammatory bowel disease, and psoriasis
• Infectious diseases comprising HIV/AIDS; neuroscience, consisting of mood disorders
• Neurodegenerative disorders, and schizophrenia
• Oncology, such as prostate cancer, hematologic malignancies, lung cancer, and bladder cancer
• Cardiovascular and metabolism, including thrombosis, diabetes, and macular degeneration; and
• Pulmonary hypertension comprising pulmonary arterial hypertension

Its MedTech segment provides:

• Interventional Solutions, including electrophysiology products to treat heart rhythm disorders
• The heart recovery portfolio, which includes technologies to treat severe coronary artery disease requiring high-risk PCI or AMI cardiogenic shock
• Neurovascular care that treats hemorrhagic and ischemic stroke. this segment also offers an orthopaedics portfolio that includes products and enabling technologies that support hips, knees, trauma, spine, sports, and other; surgery portfolios comprising advanced and general surgery technologies, as well as solutions for breast aesthetics, ear, nose, and throat procedures
• Contact lenses under the ACUVUE Brand; and TECNIS intraocular lenses for cataract surgery

Merck

Merck & Co. Inc. (NYSE: MRK) is not just a healthcare company but a global force in the industry while paying a solid 3.26% dividend.

The company operates through two segments:

• Pharmaceutical
• Animal Health

The Pharmaceutical segment offers human health pharmaceutical products in:

• Oncology
• Hospital acute care
• Immunology
• Neuroscience
• Virology
• Cardiovascular
• Diabetes
• Vaccine products, such as preventive pediatric, adolescent, and adult vaccines

The Animal Health segment discovers, develops, manufactures, and markets veterinary pharmaceuticals, vaccines, health management solutions and services, and digitally connected identification, traceability, and monitoring products.

Merck serves:

• Drug wholesalers
• Retailers
• Hospitals
• Government agencies
• Managed healthcare providers, such as health maintenance organizations
• Pharmacy benefit managers and other institutions
• Physicians
• Physician distributors
• Veterinarians
• Animal producers

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.