Best Dividend Stocks Under $20 to Buy in 2025 (High Yield & Growth Potential)
Dividend investing is a proven strategy for building wealth and generating consistent income. But finding affordable dividend stocks that also offer solid growth and sustainability can be a challenge. That’s why in this article, we’re exploring the best dividend stocks under $20 in 2025 — perfect for both beginners and seasoned investors looking for value.
Why Focus on Dividend Stocks Under $20?
- Affordability: Great for small investors or those just starting out.
- Passive Income: Regular dividend payouts help build consistent cash flow.
- Growth Potential: Many undervalued stocks have room to grow in price and dividend.
- Portfolio Diversification: Exposure to multiple sectors at low cost.
📊 Key Metrics to Look For in Dividend Stocks
When evaluating any dividend-paying stock, keep an eye on these:
- Dividend Yield: Higher is better, but not too high to suggest risk.
- Payout Ratio: Under 70% is generally healthy.
- Dividend History: Look for consistent or growing dividend payouts.
- Financial Health: Low debt and stable cash flow are essential.
Top 10 Best Dividend Stocks Under $20 in 2025
1. Ford Motor Company (F)
- Price: ~$12–$15
- Dividend Yield: ~4.5%
- Sector: Automotive
Ford has been a consistent dividend payer even through economic slowdowns. Its EV strategy and cost-cutting moves make it a strong long-term play. At under $20, it’s one of the best high-yield stocks for passive income.
2. New York Mortgage Trust Inc. (NYMT)
- Price: ~$8
- Dividend Yield: 14%+
- Sector: REITs / Mortgage
NYMT is a real estate investment trust that focuses on residential and multi-family properties. High dividend yield makes it attractive, but it's best suited for income-focused investors comfortable with volatility.
3. Aegon N.V. (AEG)
- Price: ~$5–$6
- Dividend Yield: ~6%
- Sector: Financial Services / Insurance
Aegon is a global financial services group. It offers life insurance, pensions, and asset management. With consistent dividends and restructuring efforts, AEG is a value buy for income-seekers.
4. Ambev S.A. (ABEV)
- Price: ~$2.50
- Dividend Yield: ~4.2%
- Sector: Consumer Beverages
Ambev is a Brazil-based beverage giant and part of AB InBev. Despite global headwinds, its low cost and consistent dividend make it a solid emerging market play for passive income.
5. Telefonica S.A. (TEF)
- Price: ~$4.50
- Dividend Yield: ~8%
- Sector: Telecom
Telefonica is a European telecom leader offering robust dividends and services across Spain, Germany, and Latin America. It’s a defensive stock that pays handsomely.
6. Global Ship Lease Inc. (GSL)
- Price: ~$17–$18
- Dividend Yield: ~8%
- Sector: Shipping / Logistics
GSL owns container ships under long-term charters. It benefits from global trade and offers an attractive dividend, supported by strong operating income.
7. OneMain Holdings Inc. (OMF)
- Price: ~$18–$20
- Dividend Yield: ~9%
- Sector: Financial Services / Lending
OneMain Holdings provides personal loans and financial products. With strong cash flow and aggressive dividend policy, OMF is ideal for high-yield dividend hunters.
8. MFA Financial, Inc. (MFA)
- Price: ~$10–$12
- Dividend Yield: ~12%
- Sector: REITs / Real Estate
MFA invests in residential mortgage assets. It offers a high dividend, and though REITs carry some risk, the yield compensates well for investors looking for monthly/quarterly income.
9. Crescent Capital BDC Inc. (CCAP)
- Price: ~$15–$16
- Dividend Yield: ~9%
- Sector: Business Development / Finance
Crescent Capital is a business development company focused on middle-market lending. It provides a generous dividend and caters to conservative growth investors.
10. PennyMac Mortgage Investment Trust (PMT)
- Price: ~$12–$14
- Dividend Yield: ~10%
- Sector: Mortgage REIT
PMT is a mortgage-focused REIT that invests in real estate-backed assets. Its high dividend yield and stable performance make it a standout option under $20.
🧠Tips for Investing in Low-Priced Dividend Stocks
- Don’t Chase Yield Blindly: Sometimes high yields signal underlying financial trouble.
- Diversify: Don’t put all your money into one sector or stock.
- Reinvest Dividends: Use a DRIP (Dividend Reinvestment Plan) to compound your returns.
- Monitor Financials: Keep an eye on earnings, debt, and dividend announcements regularly.
⚠️ Risks of Dividend Stocks Under $20
While many of these stocks provide strong income, they may come with risks:
- Some may reduce or suspend dividends during financial distress.
- Volatility is often higher in low-priced stocks.
- REITs and BDCs can be sensitive to interest rate changes.
✅ Final Thoughts: Should You Buy Dividend Stocks Under $20?
Absolutely — if you choose the right ones. The best dividend stocks under $20 in 2025 offer a unique mix of affordability, yield, and upside potential. Whether you’re building a new portfolio or adding income streams to an existing one, these picks can give you a head start.
As always, do your own research or consult a financial advisor before investing.
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Written by: The Stock Wealth Pro Team
Published on: April 20, 2025