Kroger (KR) is recommended for beginners with a below 12 P/E ratio, a safe 30% payout ratio, and strong dividend growth, making it a reliable passive income generator.
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5 Best Dividend Stocks to Buy Right Now (2026 Portfolio)
Jul 16, 2026
The Dividend Diplomats present five dividend stocks they would buy if starting a portfolio today, focusing on metrics like PE ratio, payout ratio, dividend growth, and stock price performance. They highlight Microsoft (MSFT) as a "no-brainer" despite current market sentiment, noting its historically low PE and strong dividend growth. They also discuss Pepsi (PEP), a "dividend king" that has faced recent headwinds but presents potential opportunities.
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McDonald's (MCD) is a top foundation stock with a 21 P/E, 57% payout ratio, 7.5% 5-year dividend growth, 49 years of dividend increases, and a 2.71% yield, considered a good value.
Procter & Gamble (PG) is a top foundation stock with a P/E of 21, 63% payout ratio, 69 years of dividend growth, a 6% dividend growth rate, and a 3% yield.
Pepsi (PEP), a "dividend king," is discussed as the second stock, noted for being down nearly 4% this year and facing consumer headwinds, which may present opportunities.
Microsoft (MSFT) is recommended as a top dividend stock pick due to its historically low PE, strong dividend growth, and diverse revenue streams, despite being down 19% year-to-date.
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MSFTbuy opened Jul 16, 2026
-4.84%