The comparison between iShares Core High Dividend ETF(NYSEMKT:HDV) and Vanguard Dividend Appreciation ETF(NYSEMKT:VIG) reveals key differences in dividend yield, sector focus, and diversification that could appeal to distinct income and growth preferences.
Both HDV and VIG target U.S. stocks with a dividend emphasis, but their approaches diverge: HDV concentrates on higher-yielding companies, while VIG seeks firms with a consistent record of growing dividends. This analysis explores how their costs, performance, risk, and portfolio makeup stack up for investors weighing income versus growth potential.
Metric
HDV
VIG
Issuer
IShares
Vanguard
Expense ratio
0.08%
0.05%
1-yr return (as of 2026-01-02)
12.0%
14.4%
Dividend yield
3.2%
2.0%
Beta
0.64
0.85
AUM
$12.0 billion
$102.0 billion
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year weekly returns. The 1-yr return represents total return over the trailing 12 months.
VIG is marginally less expensive to own, with an expense ratio of 0.05% compared to HDV’s 0.08%, and it offers significantly greater scale with assets under management of about 10 times that of HDV. However, HDV pays a much higher dividend yield, which could appeal to those prioritizing income.
Metric
HDV
VIG
Max drawdown (5 y)
-15.41%
-20.39%
Growth of $1,000 over 5 years
$1,683
$1,737
VIG tracks large-cap U.S. companies that have consistently increased their dividends, resulting in a portfolio of 338 holdings with a notable tilt toward Technology (30%), Financial Services (21%), and Healthcare (15%). Its top holdings — Broadcom(NASDAQ:AVGO), Microsoft(NASDAQ:MSFT), and Apple(NASDAQ:AAPL)— reflect this sector slant. The fund’s nearly 20-year track record and broad diversification may appeal to those seeking steady growth from dividend growers.
HDV, in contrast, focuses more narrowly on 74 U.S. stocks with higher current yields, leading to greater weighting in Consumer Defensive, Energy, and Healthcare sectors. Its largest positions — Exxon Mobil(NYSE:XOM), Johnson & Johnson(NYSE:JNJ), and Chevron(NYSE:CVX)— underscore this defensive, income-oriented approach. Compared to VIG, HDV’s sector mix and concentrated portfolio may appeal to those prioritizing yield and lower volatility.
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While there are plenty of common attributes between VIG and HDV, there are also some key differences. Here’s a quick breakdown of what they are.
First off, let’s take a closer look at VIG. This fund is focused on stocks that consistently grow their dividends, a.k.a. dividend appreciation. Therefore, it holds many stocks in high-growth industries like technology. That results in a trade off — tech companies tend to sport lower dividend yields. As a result, VIG itself has a lower dividend yield than HDV (2.0% vs. 3.2%). Yet, it has made up for its lower dividend yield with a higher rate of return. VIG has generated a five-year compound annual growth rate (CAGR) of 11.7% as opposed to 11.0% for HDV. Finally, VIG’s lower expense ratio (0.05% vs. 0.08%) means that investors pay less in fees.
Turning to HDV, there are a few ways in which it edges out VIG. Firstly, HDV’s higher dividend yield of 3.2% is important, particularly for income-oriented investors. Second, HDV’s focus on higher-yielding stocks results in a portfolio more highly concentrated on defensive sectors like energy, consumer staples, and healthcare. Consequently, HDV has seen lower drawdowns during corrections or bear markets. That’s important, because for investors focused on value and income, lower risk makes it easier to sleep at night.
In summary, VIG and HDV both offer their own compelling investment thesis. VIG is better suited to investors willing to take on some additional risk in exchange for potentially higher returns, while HDV is better suited to conservative investors seeking to preserve capital and generate higher levels of income.
ETF: Exchange-traded fund that holds a basket of securities and trades on an exchange like a stock. Dividend yield: Annual dividends per share divided by share price, showing income produced as a percentage of investment. Dividend growth: Pattern of a company regularly increasing its dividend payments over time. Expense ratio: Annual fund operating costs expressed as a percentage of the fund’s average assets. Assets under management (AUM): Total market value of all assets managed within a fund or investment product. Beta: Measure of an investment’s volatility compared with the overall market, typically the S&P 500 index. Max drawdown: Largest peak-to-trough decline in an investment’s value over a specific period. Total return: Investment performance including price changes plus all dividends and distributions, assuming reinvestment. Sector exposure: Portion of a fund’s assets invested in specific industries, such as Technology or Energy. Diversification: Spreading investments across many securities or sectors to reduce the impact of any single holding. Defensive sector: Industries like Consumer Defensive or Healthcare that tend to be less sensitive to economic cycles. Portfolio concentration: Degree to which a fund’s assets are invested in a relatively small number of holdings.
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In a market where growth stocks often steal the spotlight, reliable income still matters, especially during periods of uncertainty. High-yield dividend stocks with solid business models and steady cash flows continue to earn Wall Street’s confidence, offering investors a blend of income and stability.
Here are three high-yield dividend stocks Wall Street still trusts to deliver dependable income, even when markets turn volatile.
Valued at $170.7 billion, Verizon Communications (VZ) is one of the largest telecommunications companies in the United States, providing wireless, broadband, and enterprise connectivity services. The company’s core strength lies in its wireless business, which generates consistent, recurring revenue from millions of subscribers. This stability supports Verizon’s attractive dividend, making it a favorite among income-focused investors looking for consistency rather than quick growth.
Verizon pays a high dividend yield of 6.8% and maintains a healthy payout ratio of 57.6%, which leaves room for dividend growth as well as business expansion. It also has been paying and increasing dividends for the past 20 years, backed by steady cash generation from essential communication services. Verizon expects to generate free cash flow between $19.5 billion and $20.5 billion for the full year; that should help it continue the payouts.
Overall, Wall Street rates VZ stock as a “Moderate Buy.” Of the 28 analysts that cover the stock, eight rate it a “Strong Buy,” three recommend a “Moderate Buy,” and 17 suggest a “Hold.” Based on the average target price of $47.22, the stock has an upside potential of 16.6% from current levels. Its Street-high estimate of $58 further implies VZ stock can go as high as 43.3% in the next 12 months.
www.barchart.com
AT&T (T) remains a high-yield dividend stock that Wall Street continues to trust, thanks to its essential role in U.S. communications infrastructure. Valued at $177.1 billion, AT&T is one of the country’s largest telecom providers, delivering wireless, broadband, and enterprise connectivity services to millions of customers nationwide. AT&T’s wireless segment provides mobile voice and data services to consumers and businesses, generating steady, recurring revenue that allows it to pay consistent dividends.
AT&T’s dividend yield is 4.5%, which is significantly higher than the communications sector average of 2.6%. Its healthy payout ratio of 50% is supported by consistent cash flows from critical communication services. The company intends to generate free cash flow in the low-to-mid $16 billion range for the full year 2025, leaving the door open for dividend increases.
Overall, Wall Street rates AT&T stock as a “Moderate Buy.” Of the 28 analysts that cover the stock, 15 rate it a “Strong Buy,” three say it is a “Moderate Buy,” and 10 rate it a “Hold.” Based on the average target price of $29.68, the stock has an upside potential of 19.8% from current levels. Its Street-high estimate of $34 further implies the stock can go as high as 37.2% in the next 12 months.
www.barchart.com
Altria Group (MO) is one of Wall Street’s most trusted high-yield dividend stocks, built on decades of steady cash generation and disciplined capital returns. Best known for owning the iconic Marlboro brand in the U.S., Altria dominates the domestic tobacco market and has long been a cornerstone holding for income-focused investors.
Valued at $96.7 billion, Altria sells cigarettes and smokeless tobacco products, generating highly predictable revenue thanks to strong brand loyalty and pricing power. Even as cigarette volumes decline industry-wide, Altria has consistently offset this trend through regular price increases, protecting margins and cash flow. That resilience underpins one of the most reliable dividend profiles in the market. Altria’s high dividend yield of 7.4% is higher than the consumer staples average of 1.9%. Altria has earned the title of a Dividend King by increasing its dividend 60 times in the past 56 years, reassuring its status as one of the most reliable dividend profiles in the market.
Overall, on Wall Street, Altria stock is a “Hold.” Of the 14 analysts covering the stock, four rate it a “Strong Buy,” eight rate it a “Hold,” one says it is a “Moderate Sell,” and one rates it a “Strong Sell.” Based on the average target price of $61.45, the stock has an upside potential of 6.6% from current levels. Its Street-high estimate of $72 further implies the stock can go as high as 25% in the next 12 months.
www.barchart.com
On the date of publication, Sushree Mohanty did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
The S&P 500’s dividend yield is currently around 1.4%, which isn’t very attractive if you desire to collect passive income. However, many stocks offer much higher yields, with several presently paying dividends yielding 5% or more. Here are five stocks with payouts above that level that should generate income for their investors for years to come.
Agree Realty
Agree Realty(NYSE: ADC) yields 5.3% these days. Even better, the real estate investment trust (REIT) pays a monthly dividend. Those two characteristics make it great for those seeking to collect passive income.
The REIT supports that dividend with a portfolio of income-producing retail properties. It focuses on owning properties net leased or ground leased to financially strong national and super-regional retailers resistant to disruption from e-commerce. It therefore collects very durable and stable rental income. It pays out about 75% of that income in dividends and uses the rest to help fund new acquisitions. Its steadily expanding portfolio has supplied it with the rising income to grow its dividend at a 6.1% annual rate over the last decade. With a strong balance sheet and long growth runway, Agree Realty should be able to continue increasing its dividend in the years ahead.
Clearway Energy
Clearway Energy(NYSE: CWEN)(NYSE: CWEN.A) offers a 7.7% dividend yield. The clean power producer backs that payout with very stable income generated by selling electricity to utilities and large corporate buyers under long-term contracts.
The company expects to increase its already attractive payout by 5% to 8% annually over the long term, with growth likely toward the upper end through at least 2026. Clearway has already secured the funding and investments to deliver on that target. It sold its thermal assets in 2022, which gave it the cash to invest in several high-return renewable energy acquisitions. Those deals will close over the next few years as the projects enter commercial service. Meanwhile, Clearway should have ample power to continue growing its portfolio and payout in the future, given the country’s massive need for new renewable energy investment.
Oneok
Oneok’s(NYSE: OKE) dividend yields 5.9%. The pipeline giant supports that payout with steady cash flow backed by long-term, fee-based contracts. The company aims to increase that payout by 3% to 4% annually.
Acquisitions and organic expansion projects will fuel that growth. Oneok closed its needle-moving acquisition of Magellan Midstream Partners last year, which will help fuel double-digit earnings growth this year. It has the financial flexibility to make more deals as compelling opportunities arise. On top of that, the company has several organic expansion projects under construction and in development to support the country’s growing oil and gas production. Those projects will grow its cash flow as they come online. While the country is slowly transitioning to lower carbon energy, it will need fossil fuels for decades, which should give Oneok plenty of fuel to continue paying dividends.
Vici Properties
Vici Properties(NYSE: VICI) pays a 5.7% yielding dividend. The REIT focuses on gaming and experiential properties net leased to high-quality operators. That allows it to collect very stable rental income to support that payout.
The company has increased its dividend in all six years since its formation, including by 6.4% last September. Acquisitions are its main growth driver. It invested nearly $2 billion across various transactions last year, including its first international investments and several new experiential categories. It has continued to secure new investments this year, including funding the development of a Margaritaville Resort in Kansas City, which includes options to buy that resort and other experiential properties developed in the city by the operator. The company continues to extend its growth runway by expanding into new categories and developing new relationships with operators. Given its strong balance sheet and access to capital, Vici Properties should be able to continue expanding its portfolio and dividend for years to come.
Verizon
Verizon(NYSE: VZ) pays a 6.7% dividend yield. The telecom giant supports that payout with stable and recurring cash flows as customers pay their broadband and wireless bills.
The company is a cash flow machine. It produces enough cash to invest in its network, pay a growing dividend, and strengthen its already solid balance sheet. The company’s investments in 5G should help increase its cash flow in the coming years. Meanwhile, cost-cutting efforts (Verizon aims to shave $2 billion to $3 billion in operating costs by 2025 while reducing capital expenses by over $5 billion from its peak) and debt reduction will enable it to produce even more free cash flow. That will allow Verizon to continue increasing its dividend, which the telecom company has done for 17 straight years. While Verizon won’t grow its payout at blazing speeds (it has averaged about 2% annually in recent years), its high-yielding dividend should continue to rise gradually.
Growing income streams
Agree Realty, Clearway Energy, Oneok, Vici Properties, and Verizon all pay dividends yielding more than 5%. Those companies should be able to sustain and grow their high-yielding dividends over the long haul. That makes them great stocks to buy for a potential lifetime of dividend income.
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Matt DiLallo has positions in Clearway Energy, Verizon Communications, and Vici Properties. The Motley Fool has positions in and recommends Vici Properties. The Motley Fool recommends ONEOK and Verizon Communications. The Motley Fool has a disclosure policy.
