Dividend stocks have become more attractive than they have been in years. With the forward P/E of over 22, income begins to matter as buybacks by the S&P 500 drop. I have also somewhat rebalanced some of my own portfolio into dividend payers like VYM and good payout history utilities. The ETFs that pay 7-9 percent as covered calls are interesting, but I am wary of those, most of which cap the upside and are also more highly charged. I would prefer a growth in dividends as opposed to high yield traps. In such a long market, stability trounces the hype. Companies that increase dividends by slowing down perform better long-term. I am not paying attention to the percentage of yield, but cash flow.
As the CEO of a brokerage platform, I keep a close eye on broader markets. Right now, the income and dividend side of the U.S. stock market is holding up well, especially in the current climate where investors are looking for stability and steady income. One stock that stands out to me is American Express (NYSE: AXP). Over the last year, it has returned almost +22%, surpassing the S&P 500's 16% gain. In 2025, it also increased its quarterly dividend by 17%, bringing the yearly distribution to approximately $3.04 per share, or a 1% return. While the yield may not be the best, its strong fundamentals and low payout ratio set it apart. For newbies, focus on companies with a history of consistent profitability and dividend increases; don't just chase high yields. Look for those with low payout ratios and a history of rewarding shareholders year after year. It's a smart, long-term strategy for generating passive income.