RITM, T, or PM: Which Dividend Stock Could Deliver the Best Returns?

The ongoing trade wars have led to volatility across global markets, triggering fears of a potential recession. Several investors add dividend stocks to their portfolios during challenging economic times to ensure stable returns. Using TipRanks’ Stock Comparison Tool, we placed Rithm Capital (RITM), AT&T (T), and Philip Morris International (PM) against each other to find the dividend stock that could deliver the highest returns.

Rithm Capital (NYSE:RITM)

Rithm Capital is a global asset manager focused on real estate, credit, and financial services. Interestingly, the company conducts its operations to qualify as a real estate investment trust (REIT) for federal income tax purposes. Rithm aims to generate attractive risk-adjusted returns across market cycles and interest rate environments.

Since its inception in 2013, RITM has delivered about $5.8 billion in dividends to shareholders. With a quarterly dividend per share of $0.25 (annualized dividend per share of $1), RITM stock offers a dividend yield of 8.9%.  

Is RITM Stock a Good Buy?

In reaction to the Q1 earnings beat, Piper Sandler analyst Crispin Love upgraded Rithm Capital stock to Buy from Hold and raised the price target to $14 from $12.50, saying that shares are “overly” discounted in his opinion. The 4-star analyst noted that the company’s solid Q1 2025 beat was driven by servicing fee income. He noted that RITM generated a 17% core ROE (return on equity).

Looking ahead, Love contends that Rithm could generate 15-20% ROE, and there is a disconnect from these return levels, with the stock trading at a discount to book value and at only 5x 2026 earnings estimate. He believes that Rithm’s diversified model, comprising mortgage and asset management, should be able to withstand several environments. Love thinks that Rithm’s large servicing portfolio is well-positioned to perform in elevated rate environments, supported by the company’s aim to grow asset management further, which should enhance the stock’s valuation.

Other analysts are also bullish on Rithm Capital, with the stock earning a Strong Buy consensus rating based on seven unanimous Buys. The average RITM stock price target of $13.92 implies 22.6% upside potential from current levels. Rithm Capital stock has risen 5% year-to-date.

See more RITM analyst ratings

AT&T (NYSE:T)

Telecom giant AT&T recently impressed investors with better-than-expected first quarter revenue and in-line earnings, supported by robust postpaid phone and fiber net subscriber additions. Investors were also pleased as the company reaffirmed its full-year guidance.

To enhance shareholder returns, AT&T plans to begin share buybacks in the current quarter, with its net leverage target of net debt-to-adjusted earnings before interest, taxes, depreciation, and amortization in the 2.5-times range. The company expects to generate more than $16 billion in free cash flow in 2025.

With a quarterly dividend of $0.2775 per share (annualized dividend of $1.11 per share), AT&T stock offers a dividend yield of 4%

Is AT&T Stock a Buy, Sell, or Hold?

Impressed by the Q1 performance, UBS analyst John Hodulik reiterated a Buy rating on AT&T stock with a price target of $30. The 5-star analyst stated that Q1 results reinforced his conviction in AT&T’s ability to sustain EBITDA and FCF growth as it expands its fiber footprint.

Hodulik believes that AT&T is defensive and sees minimal direct impact from tariffs, with higher handset costs expected to be passed through to consumers and drive lower upgrades/churn in time, thus enhancing profits. “To the extent tax reform gains steam, we also see AT&T as a key beneficiary within our coverage,” said Hodulik.

With 16 Buys and four Holds, Wall Street has a Strong Buy consensus rating on AT&T stock. The average T stock price target of $30.29 implies 10.1% upside potential. AT&T stock has rallied 21% so far this year.

See more T analyst ratings

Philip Morris International (NYSE:PM)

Philip Morris International has been focusing on transitioning from cigarettes to smoke-free alternatives. It is worth noting that 42% of Philip Morris’ total new revenue in Q1 2025 was from its smoke-free offerings. The company estimates that there are 38.6 million adult users of its smoke-free products.  

Recently, Philip Morris delivered market-beating results for the first quarter of 2025, driven by strong demand for its smoke-free products. Notably, PM’s smoke-free business achieved organic net revenue growth of more than 20% and an over 33% increase in gross profit. Despite an uncertain macroeconomic environment, Philip Morris expects double-digit adjusted diluted EPS growth for the full year.

Philip Morris offers shareholders a quarterly dividend of $1.35 per share, reflecting a dividend yield of 3.1%.

What Is the Price Target for PM Stock?

Following the Q1 results, UBS analyst Faham Baig upgraded Philip Morris International stock to Hold from Sell and increased the price target to $170 from $130, citing the robust performance and margin improvements in its smoke-free products that support further upside to full-year 2025 earnings. Baig boosted his EPS estimates by 3%, reflecting a higher valuation multiple of 19x estimated 2026 earnings.

Baig said the new multiple better reflects Philip Morris’ high single-digit EPS growth outlook and resilient performance amid a volatile macro backdrop.

Overall, Philip Morris earns a Strong Buy consensus rating based on eight Buys and one Hold recommendation. The average PM stock price target of $184.38 implies 6.5% upside potential. PM stock has rallied by an impressive 44% year-to-date.

See more PM analyst ratings

Conclusion

Wall Street is bullish on all three dividend stocks discussed here. Among these three stocks, analysts expect Rithm Capital to deliver a higher total return (capital appreciation plus dividend yield) compared to the other two dividend stocks. The unanimous Buy ratings for Rithm Capital indicate that analysts covering the stock are confident about its growth potential and ability to consistently pay dividends.