I have invested in dividends for 7 years. My portfolio’s crown jewels are these dividend giants

Dividend investing is one of the best ways to buy stocks and generate cash flow. Some dividend stocks also outperform the market and can produce enticing long-term returns for patient investors.

That’s why I have been buying dividend stocks for almost a decade. Some of them have performed better than others, but if you want to beat the market, you have to focus on the fundamentals.

A corporation must produce rising revenue and earnings growth, with the yield being a nice bonus. It is vital to avoid high-yield traps, as chasing 7% to 10% yields in sectors with deteriorating fundamentals often results in capital destruction that wipes out any dividend gains. Instead, I look for resilient companies with strong growth. These are some of the dividend stocks that have powered up my portfolio.

Broadcom (AVGO)

Broadcom (NASDAQ:AVGO | AVGO Price Prediction) is the ultimate case study of focusing on dividend growth stocks instead of dividend income stocks. For most of 2018 to 2021, Broadcom had a dividend yield that hovered close to 3%. Broadcom also has a double-digit dividend growth rate, offering plenty of cash flow for long-term investors.

The yield has shrunk since then, thanks to the stock’s massive surge over the past five years. While the initial yield is lower now, its booming AI semiconductor business continues to fuel massive payouts. Broadcom recently announced a 10% dividend hike, bringing its 2026 quarterly payout to $0.65 per share, backed by a projected doubling of AI-related revenue.

The stock hasn’t slowed down despite its strong rally. It’s up by more than 50% year-to-date and has more than doubled over the past year.

Alphabet (GOOG, GOOGL)

Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) is another dividend growth stock where investors have to prioritize long-term gains over high cash flow. That’s the approach I like to follow since I am a younger investor and have more time before I have to consider using dividend payouts to cover my living expenses.

GOOG shares are up by 31% year-to-date and have more than tripled over the past five years. Alphabet’s yield has compressed slightly to around 0.25% due to stock appreciation, but their recent $0.22 quarterly payouts confirm management’s commitment to making the dividend a permanent, growing fixture alongside their aggressive cloud and AI investments.

Revenue and earnings continue to march higher for the stock. Alphabet reported 13.8% year-over-year revenue growth and 19.4% year-over-year net income growth in the second quarter. Online ads make up most of Alphabet’s business, but Google Cloud continues to grow at a fast rate and has become a key piece of Alphabet’s long-term success.

Visa (V)

Visa (NYSE:V) is the final stock on this list. It’s a dividend stock that comes with high profit margins, a strong business model, and attractive financial growth rates. The company recently reported excellent Fiscal Q2 2026 results, highlighting 16% constant-dollar net revenue growth and declaring a quarterly cash dividend of $0.67 per share. Visa CEO Ryan McInerney noted that consumer spending remained highly resilient when sharing the recent earnings results.

The stock hasn’t rallied by as much as AVGO and GOOG. Visa shares are up by 8% year-to-date and come with a 0.70% yield. The stock has also gained more than 60% over the past five years.

Visa does a good job of boosting its dividend each year. For instance, the company raised its annual dividend by 13% last year. Those meaningful dividend hikes justify staying on board despite the low yield.

Yield Enhancement Strategy: Covered Calls

Because these are dividend growth stocks, investors inherently sacrifice high initial yields for long-term capital appreciation and payout hikes. However, investors can manufacture synthetic yield on these exact tickers by selling out-of-the-money covered calls against their long positions in AVGO, GOOG, or V. Collecting premium on 30-to-45 DTE (days to expiration) calls can effectively double or triple the baseline cash flow of these low-yielding growth giants without requiring investors to liquidate their principal. The trade-off is capping extreme upside during explosive tech rallies, which is why targeting low-delta options can balance premium collection with capital appreciation.

Editor’s Note: This article includes updated mid-2026 financial metrics for Broadcom, Alphabet, and Visa, incorporating details on Broadcom’s latest dividend hike and Visa’s Fiscal Q2 revenue growth. The text also features a new section discussing the dangers of high-yield traps, alongside a strategy for generating synthetic yield on lower-yielding tech stocks through covered calls.