The Smartest Dividend Stocks to Buy With $500 Right Now

If you're worried that the market environment that's favored growth stocks over income stocks for a while now is starting to shift in the other direction, you're not unreasonable. Valuations are once again stretched. Stability, certainty, and cash payments could soon become defensive must-haves.

Fortunately, in the wake of recent (and largely unjustified) weakness, some defensive dividend stocks are especially cheap right now. Here's a look at three of these best dividend-paying bets.

Progressive

The 30% pullback in the shares of insurer Progressive (NYSE: PGR) since peaking last May makes sense on the surface. After soaring in 2024, a combination of rising reimbursement costs, economic sluggishness, a disappointing Q3, and several ratings downgrades have contributed to the sell-off.

This weakness, however, underestimates the insurance industry's overall resiliency and the strength of Progressive's brand and operation in particular.

Yes, this company's total written premiums' growth pace slowed to 12% last year, down from growth of 21% in 2024. Now consider the rest of the story. Total revenue rose 16% in 2025 while underwriting margins widened from 11.2% to 12.6%, helping net income increase from $8.5 billion in 2024 to $11.3 billion last year. That's evidence that Progressive's pricing power and operational management are better than the stock's recent performance suggests, if only because consumers must purchase insurance coverage from somewhere. This stock's dividend payment was never in any real jeopardy.

Just bear in mind that the majority of this company's dividends are paid out as a big one-time sum at the beginning of the year, reflecting the previous year's profitability. This, of course, can vary widely from one year to the next. Last year's total payout was $4.90 per share, for instance, but this past January's payment of $13.50 puts the stock on pace to dish out $13.90 for the entirety of 2026, giving it a forward yield of almost 7%. While it can be incredibly rewarding, this is why Progressive isn't a great first or or even a second dividend stock for anyone's portfolio. It's a great third or fourth dividend holding, though.

Wells Fargo

There's no denying mega-bank Wells Fargo (NYSE: WFC) has a bit of a checkered recent past. Namely, the unauthorized opening of hundreds of thousands of customer accounts that came to light in 2016 prompted the Federal Reserve to cap its total assets, thus limiting its ability to increase its top and bottom lines. Although this regulatory limit was finally lifted in the middle of last year, the company fell short of earnings estimates with its Q4 numbers released in January, and then reported disappointing Q1 numbers again in April. Both misses undermined pretty respectable progress from the stock through the end of 2025. The company just can't seem to catch a break.

Image source: Getty Images.

As with Progressive, though, take a step back and look at Wells Fargo's bigger picture. Its fourth-quarter revenue rose a little more than 4% year over year, driving per-share profits from $1.43 to $1.62. The first quarter's top line improved by more than 6%, and earnings per share rose to $1.60 from $1.39 in Q1 of 2025.

The point is, the big bank may not be meeting analysts' estimates, but it's clearly doing pretty well. With the stock priced at only less than 12 times this year's earnings projection of $6.98 per share, the company's actual results are likely to start meaning a whole lot more than analysts' opinions.

The kicker: Its dented reputation, regulatory headaches, and a couple of quarterly earnings misses aside, Wells Fargo has now upped its annual per-share payout in each of the past five years, and by more than a little. Last year's dividend increase was more than 12%, while 2024's topped 14%. The bank is decisively renewing its strong dividend growth track record, established before its payments were cut in 2020 in response to the swell of drama at that time. Newcomers will be getting in while the forward-looking dividend yield stands at a decent 2.2%.

Accenture

Last but not least, add Accenture (NYSE: ACN) to your list of dividend stocks to buy sooner than later while you can plug into its forward-looking yield of nearly 3.7%.

This is one of those companies that most people have heard of, but don't know what it does. Simply put, Accenture offers a range of business services to companies that either can't or simply don't want to tackle this work for themselves. Supply chain management, marketing, and artificial intelligence implementation are all in its wheelhouse, and more. The company did nearly $70 billion in business last year, up 7%, turning $7.8 billion of that into net income for a profit of $12.15 per share, versus the prior year's $11.44.

It's not a high-growth business. What's largely been lost while the shares declined more than 50% from their early 2025 highs, however, is the fact that Accenture's business is rather resilient regardless of the environment. The company's revenue was up 7% through the first half of the fiscal year ending in August, and Accenture still anticipates reporting full-year earnings of between $13.52 and $13.90. That's not only up between 5% and 8% from last year's bottom line, but more than enough to cover the $6.52 of per-share dividends it's likely to dish out for the full fiscal year.

This company has now raised its dividend payment for 21 consecutive years, by the way, underscoring the argument that it can push through any serious cyclical challenges.

Wells Fargo is an advertising partner of Motley Fool Money. James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Accenture Plc and Progressive. The Motley Fool recommends the following options: long January 2028 $260 calls on Accenture Plc and short January 2028 $280 calls on Accenture Plc. The Motley Fool has a disclosure policy.