AT&T’s 5G and fiber businesses are growing again.
PMI’s smoke-free business is becoming its core growth engine.
Blue chip dividend stocks are usually stable long-term investments, but they lost their luster in 2022 and 2023 as rising interest rates made CDs and T-bills more attractive. However, the Federal Reserve cut its benchmark rate six consecutive times in 2024 and 2025, driving many of those income-seeking investors back toward high-yielding blue chip stocks.
More rate cuts could be on the way this year if Trump’s nominee to succeed Jerome Powell as Fed chair, Kevin Warsh, takes office in May. The recent geopolitical conflicts could also make blue chip dividend plays more appealing than higher-growth stocks. So if you’re looking for a few safe-haven dividend plays to add to your portfolio in this turbulent market, you should consider these two stocks: AT&T (NYSE: T) and Philip Morris International (NYSE: PM).
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In 2021 and 2022, AT&T divested DirecTV, Time Warner, and its smaller media assets to abandon its costly dream of building a streaming media empire. By streamlining its business, AT&T freed up more cash to expand its core 5G and fiber businesses while reducing its debt.
As a slimmer company, AT&T consistently gained more postpaid phone and fiber broadband subscribers. From 2023 to 2025, its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increased at a 3% CAGR. It generated $16.6 billion in free cash flow (FCF) in 2025, which comfortably covered its $12 billion in dividends and buybacks.
From 2025 to 2028, analysts expect AT&T’s adjusted EBITDA to grow at a 4% CAGR as it continues to expand its 5G and fiber segments. Its recent purchase of EchoStar’s spectrum licenses should strengthen its 5G networks, while its takeover of Lumen‘s (NYSE: LUMN) home fiber business will further expand its fiber footprint.
AT&T’s stock trades at just 7 times this year’s adjusted EBITDA and yields nearly 4% in forward dividends. That low valuation and high yield should limit its downside and make it a safe place to park your cash if the market experiences another meltdown. AT&T also generates most of its revenue in the U.S., so it’s well-insulated from the recent global conflicts.
Philip Morris International was spun off from Altria (NYSE: MO) in 2008. After that split, PMI generated nearly all of its revenue overseas, while Altria remained in the U.S. market. Both companies still own Marlboro, the world’s most valuable cigarette brand.
PMI might seem like a risky stock to own as smoking rates decline worldwide, but it consistently raises its cigarette prices and cuts costs to offset that pressure. It’s also expanded its portfolio of smoke-free products — including its iQOS heated tobacco products, e-cigarettes, and its Zyn nicotine pouches — to reach more than 43 million adult consumers across 106 markets.
In 2025, PMI’s smoke-free revenue rose 14% organically and accounted for nearly 43% of its top line. That expansion is curbing its long-term dependence on its cigarette business and making it a more viable long-term investment. Its adjusted EPS grew 15% to $7.54, easily covering its annual dividend of $5.64. It currently pays a forward yield of 3.2%.
From 2025 to 2028, analysts expect PMI’s EPS to grow at a steady 9% CAGR. That growth will be driven by iQOS, Zyn, and its newer Veev e-vapor products, as well as its ongoing expansion into new markets. PMI is more exposed to overseas military conflicts and turmoil than Altria, but it’s well-insulated from the Trump Administration’s fluctuating tariffs. PMI’s stock is still reasonably valued at 24 times this year’s earnings, and it should remain a good defensive stock to own even as fewer smokers light up its flagship Marlboro cigarettes.
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Leo Sun has positions in Altria Group. The Motley Fool recommends Philip Morris International. The Motley Fool has a disclosure policy.
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