Worried About a Stock Market Crash? The Best Dividend Stocks to Buy Right Now.

Energy Transfer (NYSE: ET) offers a ~6.9% forward yield and management is targeting 4–6% annual distribution growth, positioning it as a high-yield, midstream MLP defensive holding. Digital Realty (NYSE: DLR) yields ~2.8% with sell-side earnings growth forecasts of ~9–10% over two years driven by AI/data-center demand, implying distribution and share appreciation potential. Verizon (NYSE: VZ) yields ~5.5% and is up ~25% YTD after better-than-expected results and subscriber growth, shedding its ‘‘value trap’’ reputation; the article recommends these as defensive dividend adds ahead of potential macro/geopolitical risks.

Analysis

Energy Transfer (ET) is functionally a cash-flow engine whose optionality is embedded in distribution coverage and access to capital; management’s distribution-growth target implies either steady fee-based throughput or recurring asset monetizations, making equity issuance the primary tail risk if midstream volumes compress. If oil/NGL spreads weaken for more than two consecutive quarters, expect coverage ratios to slip and units to reprice 15–25% faster than peers due to MLP structural payout expectations. Over a 12–24 month horizon, ET looks attractive as a defensive income core, but the path is lumpy — hedgeable with capped upside structures rather than naked long exposure.

Digital Realty (DLR) benefits from concentrated AI-driven demand but is exposed to a handful of hyperscalers and to power/landfill constraints that can amplify capex cycles; a single large capacity push by a cloud customer can move DLR’s next-18-month FCF trajectory materially. Valuation is sensitive to long bond moves: each 25bp parallel shift in the 10yr can change DLR’s NAV-equivalent yield spread by ~30–50bps, translating to mid-teens P&L moves for leveraged REIT structures. Treat DLR as a growth-yield hybrid — time entry to windows of stabilization in power procurement outcomes or outsized NVDA-era rack commitments.

Verizon (VZ) is in the late innings of a re-rating tied to wireless ARPU recovery and enterprise 5G monetization; upside is capped unless churn improvement and fixed-wireless gains sustain for multiple quarters. The biggest drawdown risk is renewed pricing competition from cable/MSOs or a large incremental capex cycle from competitors that forces margin compression. Over months, prefer expressed option structures that buy into continued execution rather than a long only exposure at current multiples.

Key Decisions for Investors

• Long ET units (ticker: ET) size 3–5% of portfolio with 12–24 month horizon; sell 12-month covered calls at a strike ~12% above current price to collect yield while capping upside. Hedge tail-risk with a 12-month put (10–12% OTM) costing ~1–2% of position value — R/R: expected income + 10–20% upside vs 12–15% protected downside.
• DLR tactical long via 18–24 month call spread (buy 24-month ATM calls, sell 24-month calls ~20–25% higher) to capture AI-driven leasing upside while funding premium. Size 2–4% portfolio; scenario: 15–30% gain if hyperscaler commitments continue, limited loss to premium paid if macro weakens.
• Pair trade: long ET (2.5%) / short VZ (2.5%) for 6–12 month horizon — rationale: ET’s cash yield resilience vs VZ’s re-rating that may stall. Unwind triggers: ET coverage <1.1x or VZ reports sequential ARPU deterioration; target asymmetric payoff: 15–25% upside potential vs 10–15% downside.
• If seeking convexity, buy 6–12 month DLR puts (5–7% notional) to protect REIT sleeve against a 25–50bp faster-than-expected rise in long-term rates; fund with sell of out-of-the-money calls if bullish on AI tailwind continuing.