3 Dividend Stocks to Hold Through Market Volatility This Fall

Stocks are rallying on the expectation that the Federal Reserve will cut interest rates by 25 basis points in September. That should be positive for corporate earnings. However, those expecting volatility to quiet down may be disappointed.

First, lower interest rates may push inflation higher. At the very least, an accommodative Fed policy is likely to keep interest rates above the Fed’s target rate of 2%. Geopolitical events appear to be ratcheting up. Both of those factors explain why central banks continue to buy gold, and many speculative investors are also buying Bitcoin and other cryptocurrencies.

That’s why dividend stocks may look attractive. Many dividend payers have defensive qualities, which means the company has stable revenue and earnings no matter what’s happening in the economy.

Coca-Cola: Buffett’s Dividend Favorite Keeps Delivering

One of the best qualities of a high-quality dividend stock is its ability to deliver income and growth for shareholders regardless of what’s happening in the broader economy. In 2025, The Coca-Cola Company (NYSE: KO) is up 6.37% in 2025. That’s about 50% lower than the 13% gain in the S&P 500, but it doesn’t consider Coca-Cola's 3.03% dividend yield.

At a time when many consumer staples stocks are struggling, Coca-Cola continues to grow revenue and earnings. That growth highlights the steps the company has taken to diversify its portfolio beyond soft drinks and into categories like sports drinks, teas, and enhanced water beverages.

Lower interest rates should allow the company to maintain, if not increase, its full-year guidance, according to analysts. The consensus price target for KO stock is above its 76.93, which is above the stock’s 52-week average. Plus, on Sept. 11, Peter Grom of UBS Group gave KO stock an $80 price target. That was down from $84, but still nearly 5% above the consensus price.

Johnson & Johnson: A Leaner, Stronger Dividend King

For much of the last five years, Johnson & Johnson (NYSE: JNJ) was embroiled in lawsuits focused on its talc powder and ovarian cancer. That weighed on investors' sentiment even after the company spun off its consumer products division into Kenvue.

But the remaining company is leaner, more efficient company that is focused on pharmaceuticals and medical technology (MedTech). The pharmaceutical pipeline is hyper-focused on areas like oncology and immunotherapy, while the MedTech business is putting the company’s cash to work via strategic acquisitions.

As investors began rotating out of the tech sector, JNJ has been a beneficiary, pushing it up about 22% in 2025. Plus, at around 16x forward earnings, JNJ stock is trading at a discount to its historical averages.

That growth comes on top of the company’s dividend that has a 2.93% yield. Like Coca-Cola, JNJ is a dividend king that has increased its dividend for 64 consecutive years.

Prologis: A REIT Positioned for Growth and Stability

Many investors are hoping that lower interest rates will unlock a frozen housing market. That will likely take at least 25 to 50 more basis points, but investors who want to front-run the recovery may want to consider Prologis Inc. (NYSE: PLD).

Prologis is the world’s largest industrial real estate investment trust (REIT), specializing in logistics and warehouse properties. That means occupancy rates should be stable as consumer sentiment improves. However, Prologis is also pivoting into forward-looking sectors like sustainable energy and storage, data center development, and helping businesses with their operations essentials.

While REITs can be interest-rate sensitive, Prologis’ long-term leases and strong tenant demand give it predictable cash flows. Plus, REITs are known for their reliable dividends. The stock comes with a 3.54% dividend yield, which is higher than many equities and growth potential tied to logistics demand. Also, PLD stock trades for around 19x earnings, which puts it at a discount to its historical averages.

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The article "3 Dividend Stocks to Hold Through Market Volatility This Fall" first appeared on MarketBeat.