2 Dividend Stocks to Double Up on Right Now

Dividend stocks are the best antidote for market volatility. There's nothing like seeing quarterly cash deposits in your account from industry-leading businesses. With the S&P 500 (SNPINDEX: ^GSPC) average dividend yield sitting at 1.40%, investors can find leading companies offering much higher yields.

Here are two high-yield stocks to buy now.

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1. AT&T

Shares of AT&T (NYSE: T) are up 68% over the past year. This top telecom company is reducing debt, selling its remaining interest in DirecTV, and focusing on growing its 5G wireless service and fiber internet. These moves are designed to maintain sustainable free cash flow to support its high dividend yield.

The regular bills that millions of customers pay for their phone or internet service make a large telecom provider like AT&T a solid dividend investment. The company expects to report $16 billion in free cash flow for 2025. It's been paying out less than half of its free cash flow in dividends, bringing the quarterly payment to $0.2775.

AT&T cut its dividend in 2022, which has allowed he company to reduce debt -- something that was pressuring the stock. Its debt has come down to a more maintainable level that is allowing management to focus on growth initiatives, such as expanding access to fiber internet. AT&T ended 2024 with 29 million fiber locations and expects to reach 50 million by 2029.

AT&T's wireless postpaid business is showing strength. It is seeing relatively fewer cancellations to competitors, as the company improves customer service. Last year, it added 1.7 million postpaid subscribers, which are the monthly bills that people pay to use their phone. This points to more free cash flow and the potential for dividend increases in the coming years.

The recent momentum makes AT&T an attractive income investment for 2025 and beyond. Even after the recent climb, the stock still offers a forward dividend yield above 4%, with the potential for more share price gains.

2. Hershey

Hershey (NYSE: HSY) shares have fallen over record-high cocoa prices, weak consumer spending, and heightened competition in chocolate. But this 130-year-old brand has stood the test of time. It has paid 380 consecutive dividend payments, with the yield now sitting at 15-year highs.

It's mostly the high cocoa costs that have hit Hershey stock. But spikes in commodity prices have a way of self-correcting over time. Record-high prices will incentivize more producers to step up production and increase supply.

Hershey is doing its part by adjusting its supply chain and investing in growth opportunities. Management aims to achieve $350 million in cost savings over the next few years.

Meanwhile, the company is focused on investing in opportunities that can maintain a high return on investment over the long term, and one of those areas is salty snacks. Hershey is seeing strong demand for SkinnyPop and Dot's Pretzels. It recently announced the intent to acquire the organic snack brand LesserEvil, which should boost Hershey's growth prospects and help mitigate recent weakness in chocolate.

Overall, Hershey is holding up well despite weakness in candy. Sales grew 9% year over year in the fourth quarter. Company guidance calls for sales to grow at least 2% in 2025, while higher cocoa prices pressure the company's earnings in the near term.

Wall Street analysts expect 2025 adjusted earnings to fall to $6.10, down from $9.37 in 2024. That is still enough earnings to support its quarterly dividend of $1.37.

Hershey's forward dividend yield currently sits at 3.22%. Cocoa prices have come down significantly since the beginning of the year, which boosted Hershey shares in recent weeks. More gains could be in store as investors look past the near-term headwinds and focus on Hershey's long-term prospects.

Should you invest $1,000 in AT&T right now?

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John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Hershey. The Motley Fool has a disclosure policy.