rewrite this title Top Wall Street analysts recommend these 3 dividend stocks for stable returns

Fears about the impact of a government shutdown, a slowing labor market, and elevated stock valuations are weighing on investor sentiment. Given the ongoing uncertainty, investors looking for stable returns can consider adding dividend stocks to their portfolios.

Top Wall Street analysts’ recommendations can help investors pick stocks of dividend-paying companies that have strong fundamentals to support consistent dividend payments.  

Here are three dividend-paying stocks, highlighted by Wall Street’s top pros as tracked by TipRanks, a platform that ranks analysts based on their past performance.

First on this week’s dividend list is Brookfield Infrastructure Partners (BIP), a global infrastructure company that owns and operates diversified, long-life assets in the utilities, transport, midstream, and data sectors. BIP paid a dividend of 43 cents per unit on Sept. 29, reflecting a 6% year-over-year increase. At an annualized dividend of $1.72 per unit, BIP stock offers a dividend yield of 5.2%.

Following the recently held Investor Day event, BMO Capital analyst Devin Dodge reiterated a buy rating on Brookfield Infrastructure stock with a price forecast of $42. The 5-star analyst stated that the presentations by management at the event reflected the robust underlying organic growth trends across BIP’s portfolio, which he expects to become more evident in the upcoming quarters.

Dodge highlighted that the number of high-growth platforms in BIP’s portfolio continues to increase, and there are significant investment opportunities across most of its sectors. In particular, he mentioned the robust digital infrastructure investment opportunity. With hyperscalers’ capital spending estimated to increase by 50% this year, there is a strong growth potential for BIP’s data center platforms over the intermediate term.

The analyst pointed out that BIP’s funds from operations per unit (FFO/unit) growth is nearing an inflection point. He noted that over the past five years, BIP’s FFO/unit has increased at a compound annual growth rate of about 10% despite foreign exchange headwinds and high interest rates. However, Dodge expects these challenges to ease in the near term, which could drive visible FFO growth.  

“As FFO/unit growth shifts higher, we believe there are positive implications for distribution growth and valuation,” said Dodge. Interestingly, TipRanks’ AI Analyst has a “neutral” rating on BIP stock with a price target of $33.

Dodge ranks No. 377 among more than 10,000 analysts tracked by TipRanks. His ratings have been successful 73% of the time, delivering an average return of 13.2%. See Brookfield Infrastructure Statistics on TipRanks.

We move to Ares Capital (ARCC), a specialty finance company that provides direct loans and other investments to private middle-market companies. Ares pays a quarterly dividend of 48 cents per share. At an annualized dividend of $1.92 per share, ARCC stock offers a yield of 9.4%.

In an update on business development companies, RBC Capital analyst Kenneth Lee reiterated a buy rating on Ares Capital stock with a price target of $24. Interestingly, TipRanks’ AI Analyst has an “outperform” rating on ARCC stock with a price target of $25.

In the current scenario, Lee prefers ARCC, Blackstone Secured Lending Fund (BXSL), and Sixth Street Specialty Lending (TSLX) stocks. “ARCC has a long track record of successfully managing risks through cycles,” noted Lee.

The 5-star analyst specified that ARCC is a market-leading BDC with scale. He believes that the company’s access to the Ares global credit platform is one of its major competitive advantages. Lee is confident about Ares Capital’s potential to generate above peer-average return on equity.

Lee views Ares Capital’s experienced senior management team as one of its key strengths. He also pointed out that ARCC’s dividends are backed by the company’s core earnings per share generation and potential net realized gains.

Lee ranks No. 59 among more than 10,000 analysts tracked by TipRanks. His ratings have been profitable 72% of the time, delivering an average return of 16.7%. See Ares Capital Ownership Structure on TipRanks.

Finally, let’s look at ONE Gas (OGS), a 100% regulated natural gas utility that provides affordable energy to over 2.3 million customers in Kansas, Oklahoma, and Texas. At a quarterly dividend of 67 cents per share (annualized dividend of $2.68 per share), OGS stock offers a dividend yield of 3.3%.

Recently, Mizuho analyst Gabe Moreen upgraded OGS stock to buy from hold and increased his price forecast to $86 from $77, citing several reasons, such as the benefits from the Texas HB 4384 legislation (enables recovery of certain costs associated with a gas utility’s plant, facilities, or equipment placed in service) and lower interest rates. Meanwhile, TipRanks’ AI Analyst has a “neutral” rating on OGS stock with a price target of $81.

Moreen sees the possibility of HB 4384 generating a full-year benefit of about 18 cents in incremental EPS in fiscal 2026. He added that this benefit is not one-time in nature, and will grow with ONE Gas’ yearly Texas capital spending. It is worth noting that Texas constitutes about 32% of OGS’ rate base. “We believe this will place a floor under OGS’ growth outlook at the higher-end of its 4-6%,” said Moreen.

The top-rated analyst noted that elevated short-term interest rates were one of the reasons that forced OGS to revise its guidance in 2023 and 2024. He expects the Federal Reserve’s interest rate cuts to benefit the company, as they will ease relative interest expense from prior periods.

Additionally, Moreen highlighted notable growth opportunities for OGS, thanks to the growing natural gas demand from data centers and advanced manufacturers. He believes that all these catalysts, along with a growing customer base and a solid balance sheet, make OGS stock an attractive pick at the current valuation. In fact, Moreen expects OGS to rebound to its historical premium valuation levels, at which the stock traded before the company restated its guidance in 2023 and 2024.

Moreen ranks No. 142 among more than 10,000 analysts tracked by TipRanks. His ratings have been successful 75% of the time, delivering an average return of 13.3%. See ONE Gas Technical Analysis on TipRanks.