Up More Than 12% This Year, Is This Dividend Stock With an Ultra-High Yield a No-Brainer Buy?

While major indexes and many growth stocks started 2026 sluggishly, investors have been finding their way back to value and dividend stocks. One beneficiary has been Altria (NYSE: MO), which is up more than 12% year to date as of March 26.

It's obviously a plus that Altria's stock is up, but its main selling point to investors is its consistently attractive dividend. It's routinely one of the highest you'll find in the S&P 500 (SNPINDEX: ^GSPC).

Given its nice start to the year and lucrative dividend, is Altria a no-brainer buy? Well, it depends on the investor.

Image source: The Motley Fool.

A glance at Altria's elephant in the room

Altria is the parent company of popular tobacco brands such as Marlboro, Black & Mild, Copenhagen, and a handful of others. It's the leading tobacco company in the country, but the biggest concern with Altria's business is the declining number of U.S. adult smokers.

The company has been able to use its pricing power to raise prices and help offset falling volume a bit, but that's not the best long-term strategy. At some point, raising prices won't suffice, and consumers will adjust accordingly.

Altria has been actively trying to get a meaningful presence in the smoke-free category, but it hasn't had real success. It lost nearly $13 billion on its Juul investment, illegal vape products account for a lot of the category, and Philip Morris International's Zyn has a stronghold on the nicotine pouch market.

That said, Altria has plenty of resources to continue investing and do everything in its power to make it happen.

One of the best dividend stocks on the market

Few companies prioritize their dividends as much as Altria. It has increased its annual dividend for 57 consecutive years, making it one of a small number of Dividend Kings (companies with at least 50 consecutive years of increases).

As of market close on March 26, Altria's dividend yield was 6.5% ($1.06 quarterly). That's in line with its average yield over the past decade and more than 5.5 times the S&P 500's average.

MO Dividend Yield data by YCharts

Who is Altria stock a no-brainer for?

If you're a value investor, want to add a stock that holds up well in recessions, or are retired and want a reliable income stream, Altria's stock is a no-brainer buy. It generates strong cash flow and prioritizes returning shareholder value through dividends and stock buybacks (it repurchased $1 billion worth in 2025).

If you think fewer smokers is a hurdle Altria can't get over, then I wouldn't consider it a no-brainer. The real value of owning Altria shares will come over the long haul, so you'd need to have faith in its ability to navigate the smoking and volume issues and thrive over the long term.

There's uncertainty, but I think Altria's business can continue to be a well-oiled machine for the foreseeable future while it figures it out. The tobacco industry is still huge and as recession-proof an industry as you'll find.

Stefon Walters has no position in any of the stocks mentioned. The Motley Fool recommends Philip Morris International. The Motley Fool has a disclosure policy.