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Successful passive income investors are those who most effectively balance risk, dividend yield and share price before committing their capital. Any stock with a 25-year streak of increasing dividends is worth considering, especially if it's underpriced. That's why you may be interested in these potentially undervalued dividend aristocrat stocks that investment author Rick Orford believes are primed to break out in 2025.
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Chevron provides a product that is the lifeblood of global shipping, transportation and travel and has a massive market share. These factors have combined to make Chevron stock a reliable dividend option for passive income investors. Public filings show Chevron has increased its dividend for 37 straight years, meaning most Gen Z investors weren't even born the last time this petroleum giant cut its dividend.
Despite that, Chevron shares are trading at almost 10% less than their 52-week peak, which means there is considerable upside here next year. Rick Orford notes that analysts see Chevron's shares topping out in the $190 range, which leaves plenty of room for growth from its current $150 share price range. Buy now and you could get all that upside while earning a 4.33% dividend.
Real estate investment trusts can be excellent options for dividend investors and Federal is a prime example. This REIT operates prime retail and mixed-use assets in some of America's most competitive metro areas. The highly trafficked and visible nature of Federal's assets allows this REIT to rent space on long-term, triple-net leases at a healthy price premium. This advantage has translated to solid earnings for shareholders.
Federal Realty Investment Trust is a rarity in that it holds both dividend aristocrat and dividend king status, which it earned on the back of a 56-year streak of increased dividends. Better still, analysts at Raymond James just upgraded their target for Federal to $120 and it's currently trading at $112. That leaves plenty of room for share appreciation in 2025 while earning a 3.86% dividend.