3 Magnificent S&P 500 Dividend Stocks Down As Much As 36% to Buy and Hold Forever

Key Points

• Verizon may never offer much in the way of capital growth, but its big dividend yield more than makes up for it.

• You’ve probably never heard of Accenture, but that doesn’t mean it’s not worth owning.

• Lockheed-Martin's stock struggled all year under the weight of negative headlines. Just don’t look past the bigger picture.

• 10 stocks we like better than Verizon Communications ›

There's never a bad time to buy a great stock. However, there are certainly better times than others. If you can step into an equity worth owning while it's "on sale," so much the better. This is especially true for dividend stocks, since your effective yield with a particular ticker is higher if you get in at a discounted price.

To this end, here's a closer look at three magnificent S&P 500 dividend stocks down as much as 36% from their highs that you can buy today with plans to hold onto them forever.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Image source: Getty Images.

1. Verizon Communications

You're not likely to experience any major capital appreciation with a stake in Verizon Communications (NYSE: VZ). Its core business of wireless telecom service is just too saturated these days, with Pew Research reporting that 98% of U.S. adults already own a mobile phone. In the meantime, the number of active landlines in the United States continues to shrink. Data from the Centers for Disease Control indicates that less than 2% of adults are now "landline only," in fact. And it's not like businesses are pounding down the door for landline service, either.

If you're looking for immediate above-average investment income, however, Verizon's a great place to start your search. The stock's still down nearly 30% from its late-2019 peak, pushing its forward-looking dividend yield up to 6.2%. That's based on a dividend, by the way, that's been raised every year for the past 18 years. It's so close to becoming dividend royalty, it's unlikely to break this streak now.

Verizon can also afford to fund its dividend. The $2.71 worth of payments it's dished out over the course of the past four quarters is considerably less than the fairly typical per-share earnings of $4.69 the company's expected to report this fiscal year.

Now, if there's one knock against Verizon, it's arguably its sizable debt load. As of June, it's got $124 billion worth of long-term obligations on its books, costing it roughly $6.6 billion in interest payments every year. (For perspective, the company's annual top line is now in the ballpark of $136 billion, about $20 billion of which is turned into net income.)

Verizon certainly appears capable of handling this debt, though. It's certainly not enough of a concern to avoid stepping into a position in the wireless powerhouse, and consumers certainly aren't going to give up their mobile phones now.

2. Accenture

Accenture (NYSE: ACN) is one of the world's biggest and most important companies you've likely never heard of. The $158 billion outfit did $65 billion worth of business last fiscal year, turning $7.7 billion of that into net income -- a fairly typical year, up respectably (again) from 2023's results.

But what does it do? A little of everything that helps businesses perform better.

It's often labeled as a consulting firm, which isn't an inaccurate description. But that term understates the depth and scope of what the company actually brings to the table. From strategy planning to marketing to technology support to improving operational efficiency (and more), Accenture can help a wide range of businesses be better at what they do. Spotify, Gatorade, JPMorgan Chase, Microsoft, and Uber Technologies are all customers, just to name a few.

What's curious about this company -- and compelling to income-minded investors -- is the business model itself. While about half of it is driven by consulting fees that are often one-time or short-lived relationships, the other half is "managed service" revenue that tends to be generated on a long-lived, recurring basis by clients that would rather just punt complicated ongoing work to Accenture. This predictable cash flow is ideal for any entity that pays a regular dividend.

So, if it's such a great company, why is the stock down 36% from its February peak? Fear, mostly. The market's concerned that stifling tariffs and rising interest rates will take a toll on the global economy, crimping corporate spending on services like consulting and technological support -- services that Accenture offers. This worry is certainly understandable.

This worry may not actually be merited, though. Last quarter's revenue was still up 8% year over year, and the company says it expects about the same for the full fiscal year ending this month. Meanwhile, the analyst community is calling for similar -- and similarly profitable -- growth next year.

Newcomers will be stepping in while the stock's forward-looking yield stands at 2.3%. That's not much, but the underlying dividend grows very quickly. It's grown 85% in just the past five years, in fact.

3. Lockheed-Martin

Finally, it's been a tough year for defense contractor Lockheed-Martin (NYSE: LMT) shareholders. The stock's down 26% from last October's high, with much of this weakness stemming from a dramatic reduction in the number of Lockheed-made F-35 fighter jets the Department of Defense decided to purchase this year (although interest actually began waning last year due to performance issues and, yes, the sheer cost of the entire program). A handful of U.S. allies are also reconsidering their purchases of the fifth-generation fighter jet for similar reasons, although at least some of these cancellations could also be the result of geopolitical trade tensions with the United States.

Just don't read too much into the headlines. While the F-35 is obviously an important long-term profit center for the company, it only accounts for less than one-third of its total top line, and much of this revenue is driven by maintenance contracts that will continue even if Lockheed sells fewer of these planes now.

In the meantime, much of Lockheed-Martin's other weaponry is still very much in growing demand. In March of this year, for instance, the U.S. Army earmarked up to an additional $5 billion for the purchase of Lockheed-made precision strike missiles, while in July the company announced the size of a previous contract for the purchase of high-altitude defense interceptor missiles had been expanded by more than $2 billion.

The point is, cancellations of F-35 orders are being reasonably well offset by demand for other types of weaponry that may be more relevant in the current threat environment. The company's still ultimately looking for 2025 revenue of around $74 billion, up respectably from last year's top line of $71 billion. Analysts are calling for comparable growth next year, too, rekindling strong profit growth as a result.

More to the point for income-minded investors, Lockheed-Martin is still doing more than well enough to continue paying its dividend, which has now been upped in each of the past 22 years. The stock's forward-looking dividend yield currently stands at a solid 2.9% thanks to the stock's recent weakness.

Just don't tarry if you're interested. The market may soon connect all the dots discussed above.

Should you invest $1,000 in Verizon Communications right now?

Before you buy stock in Verizon Communications, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Verizon Communications wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $661,268!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,045,818!*

Now, it’s worth noting Stock Advisor’s total average return is 1,047% — a market-crushing outperformance compared to 184% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of August 25, 2025

JPMorgan Chase is an advertising partner of Motley Fool Money. James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Accenture Plc, JPMorgan Chase, Microsoft, Spotify Technology, and Uber Technologies. The Motley Fool recommends Lockheed Martin and Verizon Communications and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.