5 Dividend Growth Stocks to Boost Your Portfolio in 2025

The stock market has been witnessing volatility in recent weeks and is expected to see the same trend going into 2025. Against such a backdrop, investors are increasingly exploring strategies that will help them protect their portfolios from downsides. Nothing seems better than the strategy of dividend investing. 

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Picking stocks with a history of dividend growth leads to a healthy portfolio with a greater scope of capital appreciation as opposed to simple dividend-paying stocks or those with high yields. We have selected five dividend growth stocks — InterDigital, Inc. IDCC, Armstrong World AWI, Charles River Associates CRAI, Fox Corporation FOX and Gildan Activewear Inc. GLD — that could be solid choices for your portfolio in 2025.

Stocks that have a strong history of dividend growth belong to mature companies, which are less susceptible to large swings in the market and thus act as a hedge against economic or political uncertainty, as well as stock market volatility. At the same time, these offer downside protection with their consistent increase in payouts.

Additionally, these stocks have superior fundamentals that make dividend growth a quality and promising investment for the long term. These include a sustainable business model, a long track of profitability, rising cash flows, good liquidity, a strong balance sheet and some value characteristics. Further, a history of strong dividend growth indicates that a dividend increase is likely in the future.

Although these stocks do not necessarily have the highest yields, they have outperformed for a longer period than the broader stock market or any other dividend-paying stock. 

As a result, picking dividend growth stocks appears as a winning strategy when some other parameters are included. 

5-Year Historical Dividend Growth greater than zero: This selects stocks with a solid dividend growth history.

5-Year Historical Sales Growth greater than zero: This represents stocks with a strong record of growing sales.

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5-Year Historical EPS Growth greater than zero: This represents stocks with a solid earnings growth history.

Next 3-5 Year EPS Growth Rate greater than zero: This represents the rate at which a company’s earnings are expected to grow. Improving earnings should help companies sustain dividend payments.

Price/Cash Flow less than M-Industry: A ratio less than M-industry indicates that the stock is undervalued in that industry and that an investor needs to pay less for better cash flow generated by the company.

52-Week Price Change greater than S&P 500 (Market Weight): This ensures that the stock appreciated more than the S&P 500 over the past year.

Top Zacks Rank: Stocks having a Zacks Rank #1 (Strong Buy) or 2 (Buy) generally outperform their peers in all types of market environments.

Growth Score of B or better: Our research shows that stocks with a Growth Score of A or B, when combined with a Zacks Rank #1 or 2, offer the best upside potential.

Just these few criteria narrowed down the universe from more than 7,700 stocks to just seven.

Here are five of the seven stocks that fit the bill:

Delaware-based InterDigital is a pioneer in advanced mobile technologies that enable wireless communications and capabilities. The company engages in designing and developing a wide range of advanced technology solutions, which are used in digital cellular and wireless 3G, 4G and IEEE 802-related products and networks. Estimates for IDCC’s earnings for this year have risen by a couple of cents over the past seven days. 

InterDigital currently sports a Zacks Rank #1 and has a Growth Score of B. You can see the complete list of today’s Zacks #1 Rank stocks here.

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Pennsylvania-based Armstrong World is a leading global producer of ceiling systems for use primarily in the construction and renovation of commercial, institutional and residential buildings. It designs, manufactures and sells ceiling systems (primarily mineral fiber, fiberglass wool, metal, wood, wood fiber, glass-reinforced-gypsum and felt) globally. The company delivered an average earnings surprise of 10.45% for the past four quarters and has an estimated earnings growth rate of 10.64% for 2025. 

Armstrong World has a Zacks Rank #2 and a Growth Score of B.

Massachusetts-based Charles River is one of the leading global consulting firms. It is engaged in providing economic, financial and management consulting services. The company delivered an average earnings surprise of 31.01% for the past four quarters and has an expected earnings growth rate of 5.21% for 2025.

Charles River has a Zacks Rank #2 and a Growth Score of A.

New York-based Fox Corporation produces and distributes news, sports and entertainment content. The company’s brand includes FOX News, FOX Sports, the FOX Network, the FOX Television Stations and sports cable networks FS1, FS2, Fox Deportes and Big Ten Network. The company delivered an average earnings surprise of 17.64% for the past four quarters and has an expected earnings growth rate of 13.99% for the fiscal year (ending June 2025).

Fox Corporation has a Zacks Rank #2 and a Growth Score of B.

Montreal-based Gildan Activewear manufactures and markets premium-quality branded basic activewear for sale, principally in the wholesale imprinted activewear segment of the North American apparel market. In the past four quarters, the company delivered an average earnings surprise of 5.40%. It has an estimated earnings growth rate of 13.80% for 2025. 

Gildan Activewear has a Zacks Rank #2 and a Growth Score of B.

You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.

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