2026 Rate Cuts Coming as Inflation Drops: 5 Quality Dividend Stocks to Buy Now

"When inflation drops, as we saw in the November consumer price index report, the Federal Reserve typically continues to cut interest rates, making fixed-income alternatives less attractive. With some firms, like Goldman Sachs, predicting two more 25-basis-point cuts in 2026, and the prospect of a new Federal Reserve chair willing to back rate cuts, quality dividend stocks are a must-own for conservative growth and income investors next year."

"Dividends have accounted for 40% of stock market returns since 1930. Companies with strong dividend-growth histories can continue to provide income even as the economic environment shifts. We focus on finding companies with sustainable payout ratios (below 70%), consistent free cash flow generation, and long track records of dividend increases through various economic cycles."

"We screened our 24/7 Wall St. blue chip quality dividend list, and five of the top companies have dividend stocks that growth and income investors can buy now, tomorrow, next week, or next year and hold for the long term. All are rated Buy at top Wall Street firms that we cover here at 24/7 Wall St."

"AbbVie Inc. ( NYSE: ABBV) is generally ranked sixth among the most prominent biomedical companies by revenue and has pivoted from blockbuster drug revenues with growing oncology and neuroscience segments. This is a top healthcare stock pick across Wall Street, and it pays a dependable 2.93% dividend. AbbVie discovers, develops, and manufactures pharmaceuticals worldwide."

Falling inflation and anticipated Federal Reserve rate cuts reduce the attractiveness of fixed-income alternatives and increase the appeal of dividend stocks. Some forecasts anticipate two additional 25-basis-point cuts in 2026 and a prospective Fed chair supportive of rate reductions. Dividends have accounted for roughly 40% of stock market returns since 1930. Priority goes to companies with sustainable payout ratios (below 70%), consistent free cash flow generation, and long histories of dividend increases through economic cycles. A blue-chip quality dividend screen identified five top Buy-rated dividend stocks for long-term growth and income. AbbVie is noted for a 2.93% dividend and a pivot toward oncology and neuroscience.

Read at 24/7 Wall St.