Down as Much as 55% and Still Magnificent: 3 Dividend Stocks Worth Holding for a Lifetime

It's been rough going for a handful of dividend stocks of late. Investors just sense more downside than upside, and are pricing it in. And the market's concerns make enough superficial sense.

If you dig deeper, however, some of these names' dividend payments are far more resilient than investors are giving them credit for. That means their stocks' recent weakness is ultimately a buying opportunity, giving you a chance to get in at an elevated dividend yield.

Here's a closer look at three of the best bets among this bunch right now, with one of them down as much as 55% from its peak price.

Realty Income

It's not difficult to understand why Realty Income (NYSE: O) shares are down 20% from their early March high. The stock soared early in the year in anticipation of the strong Q4 results that would be reported in late February. That left shares vulnerable to profit-taking, though. Between the beginning of the conflict with Iran, worries that interest rates aren't going to be coming down as soon as hoped, and profit guidance for the current quarter that wasn't quite as healthy as analysts expected, those profits were indeed taken.

This is a case, however, where the market threw the baby out with the bathwater. Realty Income is a real estate investment trust, or REIT. That just means it owns revenue-bearing real estate and passes along the majority of its profits to shareholders in the form of dividends. That's why its ticker was hit so hard in March; this business is particularly vulnerable to the sort of economic turbulence that materialized a couple of months back.

Realty Income is far better equipped to resist the sort of impact of this turbulence can make, though. See, this REIT's specialty is brick-and-mortar retailing. Its top tenants include 7-Eleven, Dollar General, FedEx, Walmart, and Tractor Supply, just to name a few. At first blush, the market's worry makes sense, particularly given the entire retail industry's ongoing challenges.

That's not a key concern for this particular REIT, however, since it serves the most resilient names in the business. That's why its occupancy rate has consistently remained above 98% since 2013, even in the midst of the COVID-19 pandemic. To the extent it matters though, no single sliver of the retail industry makes up more than 11% of its total revenue, and no single tenant accounts for more than 4%.

You'd be plugging into this monthly (yes, monthly) dividend payer while its forward-looking yield stands at just over 5%. And that's based on a dividend that's not only been paid like clockwork for decades now, but also raised every quarter for the past 28 years at an average annual rate of more than 4%.

Brookfield Renewable

Brookfield Renewable (NYSE: BEPC) trades just like any other ordinary stock, and importantly, is taxed like one. (That's not the case with its counterpart Brookfield Renewable Partners (NYSE: BEP), which is legally classified at a partnership, and as such, requires special tax treatment. So, if you're interested, just be sure you're purchasing the right ticker for you.)

But what is it? Simply put, the company manages a range of renewable energy assets like solar farms, wind farms, energy storage solutions, and -- interestingly enough -- a whole lot of exposure to the hydropower business that accounts for over 40% of its operating cash flow.

Image source: Getty Images.

And income-minded investors will certainly want to consider a stake in this often overlooked outfit sooner rather than later. Not only has its 20% pullback from its mid-April high pushed its projected dividend yield up to more than 4.4%, but it's also dragged the stock to a multi-year low that doesn't make much sense.

Sure, the same geopolitical tensions and interest rate dynamics that undermined Realty Income shares eventually also undermined Brookfield Renewable's stock. Broad weakness from utilities stocks and weakness from renewable energy stocks isn't helping either. Of course, Morgan Stanley's downgrade all the way from overweight to underweight and target price cut from $48 to $42 per share in March also left this ticker very vulnerable headed into that period.

The sellers, however, have arguably overshot their target. Nothing about the current economic backdrop should prevent Brookfield Renewable from achieving its long-term target of yearly dividend growth between 5% and 9%, and subsequent annualized total returns of between 12% and 15%. Renewables are still the future of the power business, with Mordor Intelligence expecting this sliver of the energy market to grow at an average annual pace of nearly 14% through 2031.

Pfizer

Finally, add drugmaker Pfizer (NYSE: PFE) to your list of dividend stocks you can comfortably buy and hold for a lifetime.

This certainly doesn't seem to be the case right now. Even well up from early 2025's multiyear low, Pfizer's stock is still down 55% from its late-2021 peak. That's when demand for its COVID vaccine and infection treatments was insatiable, resulting in 2022's record-breaking revenue of just over $100 billion... a feat that's not even come close to being matched in the meantime. Last's year's top line was only $62.6 billion, for perspective.

Just don't jump to any sweeping conclusions based on its recent results. The pharmaceutical company arguably became so focused on the opportunity stemming from the coronavirus pandemic that it didn't do enough development or dealmaking to fully reload its pipeline.

But it's made up for lost time. Pfizer's management team still contends it's got several new blockbusters in the works right now, with the goal of turning them alone into $15 billion and $20 billion worth of new revenue by 2030.

Although investors aren't likely to see any real fiscal evidence of a revitalization until 2028 at the earliest -- when it's expected to enter the GLP-1 weight loss market -- the company's got 18 phase 3 trials underway right now, 10 of which are tests for brand new molecular entities that aren't already on the market. Updates on these trials' progress could light a bullish fire under Pfizer's stock well before then.

More important to income investors, the company's dividend payment isn't in any real jeopardy even if Pfizer is spending a fortune refilling its pipeline that will eventually result in an oncology-focused portfolio. You can get into this savvy evolution right now at forward-looking dividend yield of 6.5%.

James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Pfizer, Realty Income, Tractor Supply, and Walmart. The Motley Fool recommends Brookfield Renewable, Brookfield Renewable Partners, and FedEx and recommends the following options: short April 2026 $55 calls on Tractor Supply. The Motley Fool has a disclosure policy.