2 Top Dividend Stocks to Buy in March

As investors have likely experienced recently, owning individual stocks for appreciation isn't always stress-free. That's because events outside of anyone's control, whether it's geopolitical or economic concerns, can affect the entire market, even if the company that you own itself hasn't done anything wrong.

That's why investors may want to consider owning dividend stocks for passive income. Although dividend stocks are affected like every other company in the market, they can still pay their regular dividends if their earnings and free cash flow remain strong.

Here are two dividend stocks investors should buy in March.

Image source: Getty Images.

Realty Income

The real estate investment trust (REIT) Realty Income (NYSE: O) is widely regarded as one of the stronger dividend stocks in the market, and for good reason. The company had a dividend yield of about 5% and the company has a solid track record, having paid and raised its annual dividend for more than three decades. Realty Income has increased its dividend at a 4.2% annual rate during this period as well.

Realty Income has built a strong business as a triple-net lease operator, leasing properties to tenants who are responsible for associated costs, including property taxes, maintenance, and insurance. In return for covering these costs, tenants may be able to negotiate better, more affordable rents for longer lease terms, while also having greater flexibility over the buildings they lease.

Realty Income focuses on leasing its properties to non-discretionary, service-oriented companies that provide lower-priced products and services. The top business categories in its portfolio are convenience stores and grocery stores, while its top tenants include 7-Eleven and Walgreens. Realty Income has also expanded outside the U.S. and into new property types such as data centers and casinos.

Furthermore, the company maintains strong coverage of its dividend. It pays out about 75% of its adjusted funds from operations, which is essentially a measure of free cash flow for REITs.

Coca-Cola

The iconic beverage maker Coca-Cola (NYSE: KO) is not only a good dividend stock, but also a strong defensive play for the times we find ourselves in. The stock has done well this year, and it tends to outperform in times of economic and geopolitical turbulence.

Coca-Cola has a fantastic track record as a dividend stock and is known as a Dividend King, meaning it has paid and raised its annual dividend for at least five decades. In fact, Coca-Cola has raised its dividend for 63 straight years, and its trailing 12-month dividend yield is about 2.6%, more than double the average among S&P 500 companies.

I think investors also view Coca-Cola as a safe asset amid concerns about the adoption of artificial intelligence. Although every business will likely use AI in one way or another, Coca-Cola sells physical beverages that can't be replaced by technology.

Coca-Cola is a mature company in a mature market, meaning growth is never likely to jump off the page, but the company has modified its drink portfolio to appeal to consumer tastes and health preferences. In the fourth quarter of 2025, Coca-Cola came up short of Wall Street revenue estimates, but the company still predicted 4% to 5% organic revenue growth in 2026, and 7% to 8% earnings-per-share growth.

After charges associated with an acquisition, Coca-Cola also expects a strong rebound in free cash flow, projecting more than $12 billion this year. That comfortably covers Coca-Cola's $8.8 billion in dividends paid in 2025 and the expected increase this year.

Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Realty Income. The Motley Fool has a disclosure policy.