In a special episode of The Morning Filter podcast, Susan Dziubinski and Dan Lefkovitz discuss why US dividend stocks have lagged behind international ones in 2025. They identify undervalued stocks with stable dividends and explore the underappreciated world of dividend growth stock investing.

Dividend stock performance in 2025 has been lackluster compared to previous years, with US dividend stocks trailing behind international ones. The rise of stock buybacks over dividends has led to lower yields for investors in dividend-seeking stocks.

Investors should consider metrics like payout ratios, economic moats, and distance to default when assessing dividend stability. Companies with strong competitive advantages and sustainable payout ratios are more likely to maintain their dividends over time.

Dividend growth investing focuses on companies that increase dividends over time, indicating strong financial health and growth potential. While dividend growth stocks have lagged the broader market in 2025, they offer stability during market downturns.

Looking ahead to 2026, investors should keep an eye on market valuations, interest rates, and economic conditions. With the US equity market potentially overheated, dividend-paying stocks, especially in the value and small-cap sectors, may offer more attractive opportunities for investors seeking stability and income.

Read more at Morningstar: Why 2026 Could Be a Breakout Year for Dividend Stocks