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Key Points
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Income-seeking investors face a choice between rapidly growing dividend stocks and those with high yields.
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Alphabet shares currently yield approximately 0.4%, while AT&T offers a yield around 4%.
Investors looking for dividend stocks have two primary choices: those that quickly increase payouts, like Alphabet (NASDAQ: GOOG), and those that provide high yields but grow slowly, like AT&T (NYSE: T). At recent prices, Alphabet’s yield is just 0.4%, while AT&T’s is significantly higher at about 4%. Alphabet’s earnings have surged, raising per-share profits by 29.4% annually over the past five years, supported by strong free cash flow of $66.7 billion. In contrast, AT&T has seen modest growth, with earnings per share only 15.8% higher over the past five years and a stagnant dividend since its reduction in 2022.
AT&T’s free cash flow reached $19.6 billion in the last year, allowing it to maintain its dividend. This year, mobility revenue is expected to grow, while consumer broadband products saw an 18.9% year-over-year increase in Q2 2025. However, Alphabet’s long-term potential may be more attractive for investors with a long horizon due to its growth trajectory and position in the AI-driven search market.
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