SCHD Is Up 20% and Offers Investors a Compelling Yield. But These 3 Dividend Stocks Could Be Even Better Buys Now.
Schwab U.S. Dividend Equity ETF is a solid high-yield option, but you may want to consider PepsiCo, Enterprise, and Realty Income instead.
In 2026, the Schwab U.S. Dividend Equity ETF (SCHD) has shown impressive growth, rising by approximately 20%, which far surpasses the S&P 500 index (SNPINDEX: ^GSPC) that has only climbed around 13%. Notably, SCHD provides an attractive yield of 3%, higher than what could potentially be achieved by investing in individual stocks.
Specifically, companies like PepsiCo (NASDAQ: PEP), Enterprise Products Partners (NYSE: EPD), and Realty Income (NYSE: O) offer dividend yields exceeding 4%. While SCHD is an index-tracking fund, its selection process is not straightforward. It prioritizes firms with a minimum of 10 years of consecutive dividend increases, excluding REITs and master limited partnerships (MLPs) due to their distinct business models.
A composite score, derived from factors such as cash flow-to-debt ratios, return on equity, yield, and a five-year track record of dividend growth, determines which 100 stocks are included in the index.
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