Dogs of the Dow Had a Strong Year. Here Are the 10 Stocks for 2026.

The so-called Dogs of the Dow are up an average of 17.8% in 2025 through Friday, Dec. 26. (Oscar B. Castillo/Bloomberg)

It’s been a good year to be a Dog of the Dow—especially for dividend investors. The ten highest-yielding stocks in the Dow Jones Industrial Average are up an average of 17.8% in 2025 through Friday, Dec. 26, beating the Dow 30’s 14.5% gain.

Healthcare giants Amgen and Johnson & Johnson , as well as old tech leaders IBM and Cisco, helped push the Dogs of the Dow higher. These four stocks are up between 28% and 44% this year.

The remaining Dogs also delivered solid returns. In fact, only one— Procter & Gamble —is on track to end 2025 in the red. According to research from Bespoke Investment Group, the ten Dogs of the Dow are on track to notch their best year on an equal-weighted basis since 2019.

Dividend-paying stocks, particularly ones with above-average yields, could continue to outperform in 2026, especially if the Federal Reserve keeps lowering interest rates next year. Long-term bond yields have tumbled from a year-to-date high of around 4.8% for the 10-year U.S. Treasury in early January to about 4.1% currently. If bond yields fall further, investors may flock to dividend-paying stocks for income.

The lineup is likely to change next year. Based on current dividend yields, IBM and Cisco would no longer be Dow dogs, mainly because of how well their stocks did in 2025, which puts downward pressure on their dividend yields. That’s obviously not a bad thing. And both stocks still yield more than 2%. McDonald’s would also be out of the club.

Created with Highcharts 9.0.1Seasoned names—two in healthcare, two in tech—pushed up the Dogs of the Dow. Source: FactSetAs of Dec. 30, 3:07 p.m. ET

Created with Highcharts 9.0.1J&JIBM Cisco Amgen 2025Dec.-20-100102030405060%

Those three stocks would be replaced by a trio of underperformers this year: Nike , UnitedHealth, and Home Depot . But Wall Street is betting on a comeback for these Dow laggards. According to FactSet, the 12-month consensus price targets for Nike, UnitedHealth and Home Depot call for an average increase of 21% from their current levels.

The other seven Dogs of the Dow—Amgen and J&J plus Verizon, Chevron, Merck, Coca-Cola and P&G—would remain Dow dogs. Verizon and Chevron pay the biggest yields by far of this group: 6.7% and 4.6%, respectively. Verizon in particular looks attractive since it remains relatively cheap too, trading at just 8.5 times 2026 earnings estimates.

The eight other Dogs of the Dow have yields ranging from 2.5% to 3%. Among that group, Amgen, Merck and J&J could continue to rally thanks to the recent rebound for healthcare stocks as concerns about tough regulatory changes from Washington fade and earnings and revenue growth begin to accelerate.

But while the Dogs of the Dow have been winners this year, it’s worth noting that their track record is inconsistent at best over the past few years. The Dogs lagged the Dow 30 in 2023 and 2024. They did post a slight gain in 2022, a year when the broader market fell due to worries about inflation and a series of interest rate hikes by the Fed.

What’s more, dividend stocks broadly have underperformed this year. The State Street SPDR S&P Dividend exchange-traded fund is up just 6% in 2025 while the State Street SPDR Portfolio S&P 500 High Dividend ETF is flat. Sectors known for particularly large dividends, such as utilities, real estate and consumer staples, have been laggards too.

Still, investors in the Dogs of the Dow can take comfort in the fact that these ten pooches pay reliable—and often very large—dividends. That should help provide steady income at a time when bond yields could head lower next year. That mix of proven income and potential rebound plays could keep the Dogs competitive in 2026—even if their bite isn’t quite as strong as it was this year.

Write to Paul R. La Monica at paul.lamonica@barrons.com