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Double Your Dividend Income: 3 Stocks to Consider
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Published in Stocks and Investing on Sunday, December 28th 2025 at 5:37 GMT by The Motley Fool- 🞛 This publication is a summary or evaluation of another publication
- 🞛 This publication contains editorial commentary or bias from the source
Double Your Dividend Income? These Stocks Offer Compelling Yields Amidst Cost Concerns (December 2025)
The current economic landscape presents a unique opportunity for income-seeking investors. Inflationary pressures have eased somewhat from their peak, but lingering cost concerns continue to impact consumer spending and corporate profitability. This environment has led to some market corrections, creating potentially attractive entry points for dividend stock investors – those looking for consistent income streams alongside potential capital appreciation. According to recent analysis by The Motley Fool, focusing on companies that not only pay dividends but are also trading at reasonable valuations can lead to a strategy of “doubling up” your dividend income over time.
The core premise revolves around identifying undervalued companies with solid fundamentals and a commitment to returning value to shareholders through dividends. These aren't necessarily "high-yield" stocks in the sense of offering exceptionally high percentages, but rather those that offer a good yield relative to their price and future growth prospects. The Fool’s article highlights three specific examples: Enbridge (ENB), Realty Income (O), and Verizon (VZ).
Enbridge: A Pipeline Powerhouse with a Discounted Price
Enbridge, a North American energy infrastructure giant, is the first stock highlighted. The company operates extensive pipeline networks transporting oil and natural gas, making it crucial for the continent’s energy supply. While the energy sector has faced headwinds due to renewable energy transition concerns, Enbridge's essential services and long-term contracts provide a degree of stability. The article points out that ENB is trading at a discount compared to its historical valuation metrics, primarily driven by investor anxieties surrounding regulatory approvals for some pipeline projects and broader uncertainty in the energy market.
However, Enbridge’s management has demonstrated a commitment to dividend growth, consistently increasing payouts over decades – earning it recognition as a Dividend Aristocrat (a company that has increased dividends annually for at least 25 years). The current yield of approximately 6.7% is attractive, and the discounted price offers an opportunity for investors to capitalize on potential future appreciation when regulatory hurdles are cleared or energy prices rebound. The Fool’s analysis emphasizes Enbridge's strong cash flow generation as a key factor supporting its dividend sustainability. [See related article: "Enbridge Stock: Is It a Buy?"]
Realty Income: Monthly Dividends and Resilient Retail
Next up is Realty Income, a Real Estate Investment Trust (REIT) known for its “monthly dividends.” REITs are required to distribute a significant portion of their income as dividends, making them naturally appealing to income investors. Realty Income owns properties leased primarily to retail tenants – a sector that has faced challenges from the rise of e-commerce. However, Realty Income’s focus on necessity-based retailers (grocery stores, pharmacies, discount retailers) has proven surprisingly resilient.
The article notes that REITs are often sensitive to interest rate changes, and rising rates have put downward pressure on many REIT share prices, including Realty Income. This presents a buying opportunity for those seeking consistent income. Realty Income’s diversification across geographic locations and tenant types further mitigates risk. The current yield is around 5%, which, combined with the monthly payment schedule, provides a steady stream of cash flow for investors. [See related article: "Why Realty Income Is a Dividend Champion"]
Verizon: A 5G Leader Facing Competition & Cost Concerns
Finally, Verizon, one of the largest telecommunications companies in the United States, is discussed. Verizon is investing heavily in 5G infrastructure and services, positioning itself for future growth in data-intensive applications. However, increased competition from rivals like T-Mobile and AT&T, coupled with rising operating costs (including spectrum license fees), have weighed on Verizon’s share price and profitability.
Despite these challenges, Verizon remains a significant player in the telecommunications industry and continues to generate substantial cash flow. The company's dividend yield currently sits around 6.8%, making it an attractive option for income-focused investors. The article suggests that while Verizon faces headwinds, its core business remains strong, and the dividend is likely sustainable given its established market position and ongoing cost-cutting initiatives. [See related article: "Is Verizon Stock a Good Investment?"]
The “Double Up” Strategy – Beyond Just Yield
While these three stocks offer compelling yields at current prices, The Fool’s “double up” strategy goes beyond simply chasing high dividend percentages. It emphasizes the importance of reinvesting dividends and allowing compounding to work its magic over time. For example, if you receive a $100 dividend each month and reinvest that back into more shares of the same stock, you'll generate even more income in subsequent months as your share count grows.
The article cautions against chasing excessively high yields, which can often be a sign of financial distress or unsustainable payouts. A thorough analysis of a company’s financials, competitive landscape, and management team is crucial before investing in any dividend stock. Furthermore, diversification across different sectors and asset classes remains essential to mitigate risk. While these three stocks present attractive opportunities, they shouldn't represent the entirety of an investor's portfolio.
Disclaimer: I am an AI Chatbot and not a financial advisor. This summary is based solely on the content of the provided URL and should not be considered investment advice. Investing in dividend stocks carries inherent risks, including the potential loss of principal. Always conduct your own thorough research and consult with a qualified financial professional before making any investment decisions.
Read the Full The Motley Fool Article at:
[ https://www.fool.com/investing/2025/12/27/dividend-stocks-double-up-right-now-cost/ ]
