Walgreens Boots Alliance, one of the top dividend-paying stocks in the S&P 500, faced challenges in 2024 but showed signs of recovery. The drugstore chain reported a rebound in pharmacy sales in the fiscal first quarter of 2025, with comparable pharmacy sales growth of 12.7%, despite a decline in retail sales. Profits were down overall, but Walgreens maintained its adjusted earnings-per-share guidance of $1.40 to $1.80 for the year.
If the company can meet these targets, the $1 per share dividend should be safe, offering significant upside potential if Walgreens returns to growth. Altria, the nation’s largest tobacco company, struggled recently after rallying through much of 2024. The tobacco sector performed well last year as investors moved into high-yield stocks like Altria, even as the business faced headwinds from the decline in smoking.
Through the first three quarters of 2024, Altria’s revenue fell 2.5%, though adjusted earnings per share rose 1.6% to $3.84.
Top income stocks for 2025
The company has placed a bet on Njoy to drive its next-gen product business but has fallen behind peers like Philip Morris International and British American Tobacco.
Verizon Communications, the telecom giant, offers the third-highest dividend yield of any S&P 500 stock at 6.9%. However, Verizon has lost market share to rivals like T-Mobile US as it mismanaged its 5G rollout, underinvesting in mid-band spectrum that offers more widespread coverage. Over the last few years, Verizon’s growth has been nearly flat as the smartphone market matured.
In the third quarter of 2024, operating revenue was stable at $33 billion, but adjusted earnings per share fell slightly from $1.22 to $1.19. Despite the company’s wide profit margins, its substantial debt creates a headwind and limits financial flexibility. While Verizon’s dividend yield may appear attractive for income investors, the stock’s track record of underperformance and limited upside potential suggest income investors could find better alternatives elsewhere.