The S&P 500 is one of the most widely known benchmarks. It contains the 500 most valuable publicly traded U.S. corporations. A company must be profitable to make it on the list, and the index regularly makes adjustments based on changes to companies that are in and out of the index.
While the S&P 500’s focus on growth stocks has resulted in some solid long-term gains, there are some dividend stocks that have outperformed the benchmark. Concerns at the start of the year due to tariffs and DeepSeek caused the S&P 500 to tumble out of the gate, and even with its recovery, the benchmark is only up by 4% year-to-date.
Most investors would be happy with beating the S&P 500. While this reward is usually reserved for growth stocks, a few dividend kings like the ones covered here have surpassed the index so far.
Realty Income (O)
Realty Income (NYSE:O | O Price Prediction) is a real estate investment trust that pays out monthly dividends and currently has a 5.55% yield. Its portfolio is filled with NNN leases, which results in steady cash flow from reliable tenants. The company does business with various corporations that are more likely to keep up with rent payments than tenants with bad credit scores.
The real estate company has enjoyed a strong year and is up by 11% so far. Interest rate reductions can further boost the stock’s price and help it stay ahead of the S&P 500. Realty Income has been in business for more than 50 years and grew its revenue by 10% year-over-year in the first quarter. The firm generated $1.38 billion in Q1.
The company has a well-diversified portfolio of more than 15,000 properties that it either owns outright or has a stake in. Realty Income also has 1,598 clients in 91 industries. This pipeline suggests that the cash flow will keep on coming, along with the monthly dividends.
Verizon (VZ)
Verizon (NYSE:VZ) stock isn’t known for making splashy price movements in either direction. It’s a pretty boring stock that has relatively low volatility while commanding a 6.37% yield. However, shares are up by 6% year-to-date as investors look for stability and an under-the-radar AI beneficiary.
Verizon has built an expansive 5G network, and AI tools require a lot of energy. It’s a good match that can boost the demand for Verizon’s services, but Verizon also has a decent 10 P/E ratio. The stock’s valuation isn’t removed from reality, and gradual financial growth suggests that the small rally can continue.
However, the S&P 500 may reclaim its year-to-date lead over Verizon in the second half of the year. Positive catalysts plus the prospect of the Fed cutting rates will help Verizon, but the S&P 500 will likely be the bigger beneficiary.
CVS Health (CVS)
A miserable 2024 that featured a 40% loss has set CVS Health (NYSE:CVS) to be one of the biggest rebound candidates of 2025. The stock is up by a blistering 54% year-to-date and has a respectable 3.91% yield. More optimism around the company’s forecasts and a solid first quarter have fueled the rally.
Most of the gains took place at the start of the year, even amid tariffs and AI concerns. CVS Health has more insulation from those two headwinds since it is in the healthcare industry. Few people will make cuts to their healthcare and related purchases compared to non-essentials.
The stock has only rallied by about 2% from February 14 to June 24. That trend is more likely for long-term investors since shares are only up by 7% over the past five years. However, CVS Health’s bad 2024 set it up to be a top-performing dividend stock that has crushed the S&P 500 year-to-date. However, this may be an anomaly.
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