The Best Dividend Stocks to Buy and Hold Forever

Do the sky-high valuations of a handful of artificial intelligence (AI)-related growth stocks have you leery of touching any of them?

Or, maybe you expect value stocks to take the performance lead back from growth names in the foreseeable future. Perhaps you'd just like a portfolio that requires a little less monitoring?

Whatever the motivation (and you can have more than one), dividend stocks fit the bill.

To this end, here's a rundown of three of the best dividend-paying tickers you can buy today and hold forever.

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Realty Income

Realty Income (NYSE: O) isn't exactly a household name, but it's possible you regularly benefit from the service it provides. This company is a real estate investment trust, or REIT, meaning it owns a bunch of rent-bearing commercial properties and passes along the majority of its profits to shareholders.

Not just any properties though. While there are all sorts of REITs, Realty Income specializes in retail real estate. Its top customers include 7-Eleven, Dollar General, FedEx, Home Depot, and Walmart just to name a few, although no single tenant accounts for more than 3.3% of its total rent revenue.

At first blush it seems like a risky focus, given the wobbly condition of the brick-and-mortar retail industry. If you look closely though, you'll find Realty Income tends to lease properties to the business's stronger names. As of the end of the third quarter, 98.3% of its properties were occupied, extending a long-standing, market-leading track record.

That's not the top reason income-minded investors might want to consider owning a stake in this REIT, though. Rather, the big selling point here is how -- and how reliably -- it dishes out its ever-rising payouts. Not only has Realty Income now paid a dividend every month (yes, a monthly dividend) for more than 55 consecutive years, but has raised its per-share payment every quarter since 1997. It's unlikely this streak is going to end in the foreseeable future, if ever.

PepsiCo

Any investor looking at the consumer goods space for income investments is likely to stumble across Coca-Cola (NYSE: KO) before digging deeper to find PepsiCo (NASDAQ: PEP). And to be fair, Coca-Cola is arguably the better company by virtue of consumers' love for its brands and its sheer size.

The best company in a particular business isn't always necessarily its best dividend stock, though. And right now, PepsiCo's forward-looking dividend yield of nearly 4% versus Coca-Cola's 3% is enough of a difference to favor the former for newcomers.

Then there's the other thing.

With nothing more than a passing glance these two beverage companies are practically interchangeable. Look under the hood though, and you'll find some major differences. Chief among them is the fact that while Coke delegates the majority of its bottling work to third-party bottlers who then distribute the product to retailers, PepsiCo owns the majority of its own bottling operations and distribution channels.

Coca-Cola's model ultimately translates into a higher profit margin, since the production sliver of the beverage business has become particularly expensive to run. But PepsiCo has more precise control of its production. It also owns snack chip company Frito-Lay, putting it in a complementary market Coca-Cola isn't in at all.

It matters simply because the beverage market is becoming even more competitive as consumers become more willing to try brands they didn't necessarily grow up with, or even entirely new brands. If this dynamic persists, PepsiCo's ability to manage its production with laser precision -- particularly now that artificial intelligence is providing such detailed information about the business -- could turn what's been seen as a liability into a competitive advantage.

Either way, PepsiCo's 53-year streak of raised dividend payments isn't likely to end anytime soon.

NextEra Energy

Finally, add utility outfit NextEra Energy (NYSE: NEE) to your list of dividend stocks to buy and hold forever.

On the surface it doesn't look like anything special... just another utility company. Indeed, its forward-looking dividend yield of 2.8% is a bit below the industry's average for similarly sized companies.

There is something unique -- and bullish -- about this company, however. That is, if you were going to build a utility name from scratch today with future environmental and regulatory concerns in mind, it would look a lot like NextEra Energy. More than half of its power production already comes from renewables, while nearly half is produced by nuclear power and reasonably clean natural gas. It's got no legacy fossil fuel assets to speak of.

It doesn't really matter yet. Although regulations are certainly becoming more environmentally minded, the U.S. utilities business still looks quite a bit like it did yesteryear.

The march toward net-zero emissions is still underway, even if it's slowed a bit under the White House's current administration. The United States' Energy Information Administration continues to predict that renewables will account for nearly all of the country's power-production capacity growth between now and 2050, with outright declines in natural gas's and nuclear's share of the country's electricity generation expected to begin sometime in the 2030s. Solar and wind continue to be the workhorses of the renewable energy industry.

Whatever the regulatory future holds for the utilities industry, NextEra Energy stands ready for it now, and as such won't be scrambling -- or spending heavily -- to meet those requirements when the time comes. That's why you can hold on to its stock forever.

James Brumley has positions in Coca-Cola. The Motley Fool has positions in and recommends Home Depot, NextEra Energy, Realty Income, and Walmart. The Motley Fool recommends FedEx. The Motley Fool has a disclosure policy.