đ 3 Dividend Stocks Primed for a 2025 Second-Half Rally (Wall Street Wonât Tell You This)
Dividend dynamos are loading up for a late-2025 surgeâwhile hedgies distract you with meme coins.
The Contrarian's Dividend Playbook
Forget 'safe' utility stocksâthese cash-flow machines combine yield with explosive upside potential. We're talking about companies printing money while the Fed still struggles with inflation.
Why Q3-Q4 2025 = Perfect Storm
Market cycles suggest a rotation into value plays right as these stocks hit oversold territory. Their dividend cushions make them bulletproof during volatilityâunlike your cousin's NFT portfolio.
The Ironic Truth
While finfluencers chase 1000x shitcoins, these stocks offer something radical: actual profits. With payout ratios under 60% and institutional ownership at yearly lows, the setup screams opportunity.
Bottom line: In a market high on hopium, these dividend stocks are the sober trade. Now watch Wall Street 'discover' them right before earnings season.
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Brookfield Infrastructure offers a high-yield stock that's partly powered by data centers
: Lagging the 8.2% rise in the S&P 500 since the start of 2025, shares of Brookfield Infrastructure are up 4.9% year to date as of this writing.
While the stock's underperformance may be disheartening for shareholders, there's no reason to speculate that the trend will continue throughout the remainder of the year. In fact, there's good reason to suspect that shares will bound higher in the back half of 2025, making today a great time for passive income investors to pick up Brookfield Infrastructure stock along with its 4.1% forward-yielding dividend.
While Brookfield Infrastructure stock has provided a lackluster performance recently, the growing interest in artificial intelligence (AI) may lead investors to consider Brookfield Infrastructure stock as a way to gain AI exposure. Because data centers provide the backbone for AI computing, data center stocks have benefited from the explosion in AI interest. In addition to the midstream, transport, and utility assets it operates, Brookfield Infrastructure also includes data centers in its portfolio. In fact, data centers represent about 13% of Brookfield Infrastructure's funds from operations.
And while it doesn't represent one of the larger asset classes in the portfolio at present, there's no reason to dismiss the possibility that the company may seek further data center acquisitions to strengthen its portfolio.
Currently, shares of Brookfield Infrastructure are priced at a discount to their historical valuation, trading at 3.3 times operating cash FLOW compared to the five-year average operating cash flow multiple of 4.
Although semiconductor stocks and nuclear energy start-ups are getting the lion's share of attention right now as AI investment opportunities, Brookfield Infrastructure isn't basking in the limelight. However, that may change significantly in the remainder of 2025.
A long-term winner from the trade war
This is a somewhat controversial call, but hear me out. I believe the household appliance Maker may well be compelled to revise its full-year earnings and cash flow expectations, and potentially cut its dividend in the process.
The reality is that mortgage rates are close to where they were when the Federal Reserve last started cutting its rates last year, and the housing market hasn't shown meaningful improvement.
That's not great news for a company that relies on purchases of higher-margin, discretionary major household appliances. In addition, the fear of further tariff escalation may have encouraged Asian competitors to push forward imports to the U.S.
30 Year Mortgage Rate data by YCharts
The setup is not ideal going into the company's second-quarter earnings report, and significant near-term risks remain.
Still, there's strong reason to believe that Whirlpool will emerge as a long-term winner from President Trump's trade actions, not least as the administration seeks to close loopholes that have allowed competitors to avoid paying tariffs on Chinese steel used in their products. Moreover, with 80% of what it sells in the U.S. being produced in the U.S., the company is well positioned to prosper long-term from ongoing tariffs. The market may recognize that possibility after the earnings report (which could contain bad news) is released.
Dow is a better buy now that the dividend is lower
The chemical giant plummeted 17.5% on July 24 in response to weak second-quarter 2025 results and a 50% cut to its dividend. The dividend reduction marks the first adjustment to the payout since Dow spun off from DowDuPont in 2019 and initiated a $0.70 per share quarterly dividend. The latest quarterly dividend was $0.35 per share.
Dow's sales and earnings continue to decline due to weak volumes and pricing pressure. The commodity chemical industry is in a multiyear downturn due to weakness across end markets, with Dow calling the situation a "lower-for-longer earnings environment" in its second-quarter earnings release.
"Dow's strategic actions enable us to mitigate the dynamic factors that our industry is facing," said Dow's CEO, Jim Fitterling, in the earnings release. "However, signs of oversupply from newer market entrants who are exporting to various regions at anti-competitive economics require broader industry engagement and additional regulatory action to restore competitive dynamics."
Dow's plummeting earnings, a lack of guidance, and management's concerns about a prolonged downturn have led investors to become understandably sour on the stock. The cut to the dividend means there's less passive income to help cushion declines in the stock price. But as I alluded to in June, even if Dow cut its dividend in half, it WOULD still have an excellent yield because the stock is so beaten-down. Even after the dividend cut, Dow still yields a sizable 5.6%.
More importantly, the dividend cut frees up dry powder for Dow to fix the underlying business, manage costs, and ride out this downturn. The company has sold off some assets to raise cash, but that's not a viable long-term strategy. The dividend cut will save Dow about $990 million per year. For context, Dow's cost-saving program is $1 billion -- so cutting the dividend is roughly equal to efforts across Dow's operations.
Typically, shareholders prefer to see dividend growth, not a cut. So it may seem strange to buy the stock now that there's less passive income. But long-term investors that are more interested in where a company is headed than where it has been may want to scoop up shares in this commodity chemical giant while it is out of favor.
With cost savings, a lower dividend expense, and billions in cash Flow from asset sales, Dow has what it takes to endure this slowdown and return to earnings growth when the cycle turns. If macro data is encouraging, I could see Dow recovering quickly in the second half of the year. However, Dow is forecasting more challenges across its end markets -- especially infrastructure. So it's best to only consider the stock if you have a long-term investment time horizon and a high-risk tolerance, given there's no telling how long this downturn will last.
