The S&P 500 has hit an all-time high and surged 9.6% in 2025, but investors can still find safety in dividend-paying stocks during times of market volatility. Morgan Stanley strategist Todd Castagno notes that dividends become more important in periods of elevated risks and valuations, dampening volatility and supporting stock prices.
Morgan Stanley’s analysis has screened companies with a high dividend yield and significant increases in their dividend payments over the past year. Two dividend-paying stocks to watch are Oracle and American Homes 4 Rent.
Oracle shares have increased by 49% in 2025 despite a modest current dividend yield of 0.8%. The company has posted strong fiscal fourth-quarter results and expects $67 billion in revenue in 2026, with analysts predicting significant upside. Analysts like the stock, but the average price target implies limited upside.
American Homes 4 Rent has also seen its shares increase by nearly 8% in 2025, driven by higher development yields and a lift in funds from operations guidance. The company’s dividend yield is 3.5%, making it an attractive option during times of slowing growth and falling interest rates.
Wireless communications giant T-Mobile is another stock to consider, with a dividend yield of 1.4% and a bullish rating from Morgan Stanley analyst Benjamin Swinburne. However, the consensus price target suggests limited upside.
These dividend-paying stocks can offer investors some protection during market volatility, but it’s essential to conduct thorough research and consider individual company fundamentals before making any investment decisions.
Source: https://www.cnbc.com/2025/08/18/these-stocks-offer-rising-dividends-morgan-stanley-says.html