3 Dividend Stocks Poised to Outperform the S&P 500 Beyond 2025

By: Sayan

Published on: May 21, 2025

Introduction

Investing in dividend stocks offers two primary ways to generate returns: capital gains and consistent dividend payouts. Stocks that combine growing dividends with strong capital appreciation can help investors achieve long-term financial goals and passive income. In this article, three Motley Fool contributors highlight why Deere & Company (NYSE: DE), Cheniere Energy Partners L.P. (NYSE: CQP), and Sunoco L.P. (NYSE: SUN) are top dividend stocks poised to outperform the S&P 500 (SNPINDEX: ^GSPC) beyond 2025.

Key Takeaways

• Deere & Company: Delivers strong results despite economic challenges, with a robust outlook for long-term growth.


• Cheniere Energy Partners: Offers a 5.3% distribution yield and stable cash flows from LNG exports.


• Sunoco L.P.: Benefits from a strategic acquisition, boosting cash flow and supporting its 6.3% dividend yield.

1. Deere & Company (NYSE: DE): A Leader in Agriculture and Construction

By Daniel Foelber

Why Deere Stands Out

Deere recently hit an all-time high on May 16, 2025, after reporting its fiscal Q2 2025 results. Despite a 16% year-over-year drop in net sales and a 24% decline in net income, the stock surged, likely due to better-than-expected performance amid global economic uncertainty and tariff pressures.

Financial Resilience

• Profit Margins: Deere achieved an 18.8% margin on equipment operations, surpassing expectations despite $100 million in quarterly tariff headwinds.


• Guidance Update: The company revised its full-year net income guidance to $4.75 billion–$5.5 billion, reflecting tariff impacts but signaling operational strength.


• U.S.-Centric Supply Chain: Deere’s domestic manufacturing mitigates tariff risks compared to competitors with globalized supply chains.

Long-Term Growth Potential

Deere remains a leader in agriculture, construction, and forestry, with investments in AI and automation driving innovation. Its free cash flow supports a growing 1.2% dividend yield, stock buybacks, and R&D. With a price-to-earnings (P/E) ratio of ~28.1 at the midpoint of guidance, Deere is reasonably valued for a cyclical company in a downturn. Over the past five years, Deere’s stock has gained 285%, including a 25% year-to-date increase in 2025, outpacing the S&P 500.

Why It’ll Outperform: Deere’s competitive advantages, strong management, and focus on long-term growth position it to continue crushing the S&P 500.

2. Cheniere Energy Partners (NYSE: CQP): Stable Cash Flows and High Yield

By Lee Samaha

A Leader in LNG Exports

Cheniere Energy Partners, a master limited partnership (MLP), owns the Sabine Pass LNG Terminal, one of the world’s largest liquefied natural gas (LNG) facilities. Unlike its parent, Cheniere Energy, it focuses on generating stable, long-term cash flows through take-or-pay contracts with major global energy firms.

Financial Highlights

• Key Customers: In 2024, 77% of external revenue came from major players like Korea Gas, Shell, GAIL India, Naturgy LNG, and TotalEnergies.


• Distribution Yield: Offers a compelling 5.3% yield, supported by consistent cash flows.


• Stock Performance: Up 15.3% year-to-date in 2025, outperforming the S&P 500’s modest gains.

Growth Outlook

The U.S. is a leading LNG exporter, and supportive policies, including the lifting of a pause on new LNG project permits in 2025, bolster Cheniere’s outlook. Geopolitical challenges limiting Russia’s LNG exports further enhance the U.S.’s role in global markets, benefiting Cheniere.

Why It’ll Outperform: Cheniere’s stable cash flows, high yield, and exposure to growing global LNG demand make it a strong candidate to beat the S&P 500.

3. Sunoco L.P. (NYSE: SUN): Fueling Growth Through Acquisitions

By Scott Levine

A Midstream Powerhouse

Sunoco, North America’s largest independent fuel distributor, has outperformed the S&P 500 in 2025, with its stock up 9.6% year-to-date compared to the index’s 1.3% gain. Its 6.3% forward dividend yield makes it attractive for income investors.

Strategic Acquisition

Sunoco’s $9.1 billion acquisition of Parkland, expected to close in H2 2025, will expand its operations across North and South America and Europe. Key benefits include:

• Synergies: $250 million run-rate synergies by the third year post-acquisition.


• Cash Flow Growth: A projected 10% increase in distributable cash flow by year three.


• Free Cash Flow: A pro forma increase of over 50% compared to pre-acquisition levels.

Why It’s a Buy

The acquisition enhances Sunoco’s scale, diversifies its operations, and supports its high-yield dividend. With robust cash flows, Sunoco is well-positioned for further growth opportunities, even in a volatile energy market.

Why It’ll Outperform: Sunoco’s acquisition-driven growth and sustainable dividend make it a top pick for income and capital appreciation.

Should You Invest in These Stocks?

While Deere, Cheniere Energy Partners, and Sunoco offer compelling opportunities, always conduct thorough research before investing. For more stock recommendations, consider The Motley Fool Stock Advisor, which recently released its top 10 stocks for 2025. Although Deere didn’t make the list, the service has a strong track record, with an average return of 975% compared to the S&P 500’s 172% since 2002.

Example Returns:

• A $1,000 investment in Netflix (recommended December 17, 2004) would be worth $642,582.


• A $1,000 investment in Nvidia (recommended April 15, 2005) would be worth $829,879.

Join Stock Advisor for the latest insights and recommendations.

Conclusion

Deere, Cheniere Energy Partners, and Sunoco are three dividend stocks with strong fundamentals, attractive yields, and growth potential to outperform the S&P 500 beyond 2025. Whether you’re seeking passive income or capital gains, these companies offer a blend of stability and upside.