3 Top Dividend Stocks to Buy in January

Want to start the new year on a positive note? Get some income rolling into your bank account. The most effective way to achieve this goal is to invest in dividend-paying stocks.

Of course, with thousands of dividend stocks trading on the market, it's easy to be overwhelmed by the decision about which ones to buy. If you're looking for solid ideas, here are three top dividend stocks to buy in January.

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1. Ares Capital

It offers a forward dividend yield of 9.3%. That's perhaps the most important thing to know about Ares Capital (NASDAQ: ARCC). The obvious question, though, is: How safe is that juicy dividend? I think the answer to that question is reassuring.

Ares Capital's yield is so high primarily because it's a business development company (BDC). To be exempt from federal income taxes, BDCs must return at least 90% of their profits to shareholders as dividends. Ares Capital continues to generate substantial profits, allowing it to distribute a significant amount of money to its shareholders.

The company has either maintained or grown its dividend for 65 consecutive quarters. It has been able to build that impressive record thanks to a highly diversified portfolio, expertise in selecting the most promising direct lending opportunities, and stable access to capital.

In my opinion, Ares Capital's dividend is relatively safe. Even better, this stock is likely to deliver exceptional total returns over the long term. Since its IPO in 2004, Ares Capital has generated stock-based total returns that are 40% higher than those of the S&P 500 (SNPINDEX: ^GSPC). With an improving market for BDCs, I predict that Ares Capital will continue to outperform the S&P 500's total returns over the next decade.

2. Enbridge

If you want even greater dividend safety, though, Enbridge (NYSE: ENB) should be an attractive stock to buy. This energy company has increased its dividend for 30 consecutive years. Its forward dividend yield is roughly 6.1%.

A few key facts about Enbridge perhaps best explain why its dividend is likely to remain safe. First, the company ranks as the largest natural gas utility in North America based on volume. Second, Enbridge's pipelines transport 40% of the crude oil imported to the U.S., 30% of the crude oil produced in North America, and 20% of the natural gas used in the U.S. The bottom line is that the company's businesses are critical to the U.S. and Canadian economies.

Unsurprisingly, Enbridge has generated risk-adjusted returns over the last 20 years that beat the S&P 500, other midstream stocks, and the utilities sector. It helps that the company's cash flow stems from over 200 asset streams and businesses, while less than 1% of its EBITDA is linked with commodity prices.

I especially like that Enbridge projects roughly $50 billion of growth opportunities through 2030. The demand for natural gas and natural gas liquids (NGLs) is expected to increase over the coming years, partially due to the construction of new data centers.

3. Realty Income

Realty Income (NYSE: O) remains one of my favorite dividend stocks to buy as 2026 begins. This real estate investment trust (REIT) pays a monthly dividend that yields 5.7%. Like Enbridge, Realty Income has increased its dividend for 30 consecutive years. Unlike Enbridge, though, the company has increased its dividend for 133 consecutive quarters.

Stability is the operative word with Realty Income. The REIT has outperformed the S&P 500 during periods of high volatility. It has delivered steady growth regardless of interest rate levels. And Realty Income has generated positive total operational returns (defined as the sum of adjusted funds from operations per share and dividend yield) for 29 consecutive years.

This stellar track record is a direct result of Realty Income's real estate portfolio. The company's 1,647 clients represent 92 industries and include leading businesses such as Dollar General (NYSE: DG), FedEx (NYSE: FDX), and Walmart (NASDAQ: WMT).

Realty Income estimates its total addressable market is around $14 trillion. Roughly 60% of that opportunity is in Europe, where there's limited competition.

Keith Speights has positions in Ares Capital, Enbridge, and Realty Income. The Motley Fool has positions in and recommends Ares Capital, Enbridge, Realty Income, and Walmart. The Motley Fool recommends FedEx. The Motley Fool has a disclosure policy.