The Schwab US Dividend Equity (SCHD) ETF has done well in the past decade as it became one of the biggest dividend and sleep-well-at-night (SWAN) funds. It has soared by over 400% since its inception in 2012 and generated more total returns than other funds.
Best SCHD ETF stocks to buy
The best way to take advantage of the SCHD ETF is to buy and hold it for a long time. One can also selectively invest in some of the best stocks in the fund. Some of the best SCHD stocks to buy are: Blackrock, Altria, Chevron, Lockheed Martin, and Home Depot.
Read more: SCHD outlook for 2025: blue chip dividend ETF faces turbulence
Blackrock (BLK)
Blackrock is one of the best SCHD stock to buy because of its role in the global economy and the growth initiatives the management has implemented. It is the biggest asset manager globally with over $11.7 trillion in assets, mostly in its ETF business.
Blackrock is also changing its business by investing in infrastructure and private credit. It acquired Global Infrastructure and HPS Investment Partners. GIP gave it access to the lucrative infrastructure division, while HPS is a big player in the private credit business. Therefore, the company will likely continue doing well as it races towards $20 trillion in assets.
Altria (MO)
Altria is another good SCHD stock to buy, especially if you don’t mind investing in tobacco companies. It is a large company that owns brands like Philip Morris USA, John Middleton, and NJOY.
Altria, like other tobacco companies, has done well in the past few months as its stock soared by almost 40% in the last 12 months. This growth happened as investors embraced tobacco firms as the ESG trend ended.
Altria is a good SCHD company to buy because of its strong dividend yield of 7.8% and regular share repurchases.
Chevron (CVX)
Chevron, the second-biggest energy company in the US, is another good SCHD ETF stock to buy. Its stock has jumped 16% from its lowest point this year as investors cheer the Trump administration’s energy-friendly policies.
The company will likely benefit from the relatively weak red tape and the potentially muted trade war. Also, it benefits from the elevated crude oil prices globally.
Chevron is largely an all-weather stock. Its shares usually drop when oil prices drop and then rebound when they bounce back.
Lockheed Martin (LMT)
Companies in the military-industrial complex will likely do well under Trump as he seeks to boost defense spending in the US and other countries. Such a move will benefit firms like Lockheed Martin and RTX that make billions of dollars annually from these lucrative contracts.
Lockheed is also expected to report strong financial results now that it has restarted its work on the F-35 program. The stock is also a bargain now that it has dropped by over 20% from its highest level in 2024.
Home Depot (HD)
Home Depot is a top SCHD ETF stock to buy and hold because of its market share in the home improvement industry. The recent drop from its all-time high was mostly because of the potential tariffs by the Trump administration.
Tariffs may hit Home Depot and other retailers. However, the reality is that they have all done well since Trump implemented huge tariffs in his first term.
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