Better Dividend Stock: Dominion Energy (D) Vs. Southern Co. (SO)

Having to choose between dividend paying stocks is one of those good problems to have. This is especially true when the companies have proven histories of returning value to shareholders over an extended period of time. Two dividend payers that fit this description are Dominion Energy (NYSE: D) and Southern Co. (NYSE: SO), both of which are energy utility companies and are considered defensive plays during times of economic uncertainty.

Utility stocks and dividends often go hand in hand, as these defensive plays generate steady streams of income for delivering electricity to customers across U.S. states. While both businesses boast impressive dividend paying track records, there are nuances that distinguish them from each other and could help you choose between them.

Dominion Energy Dividend Analysis 

Dividend Amount: $0.6675
Dividend Frequency: Quarterly 
Dividend Yield: 5.02%

Dominion Energy or its predecessor company boasts a track record of paying nearly 400 consecutive dividends to holders of its common stock, the most recent one of which was declared in Q1 2025. In 2024, Dominion paid a total dividend payment of $2.67 per share to investors and has begun matching that pattern in 2025. 

The best part of Dominion Energy’s dividend is its yield, which hovers at approximately 5%, far surpassing that of the average S&P 500 company of below 2%. This ratio reflects the amount Dominion Energy returns to shareholders relative to its share price. While dividend payments are steady, Dominion Energy hasn’t raised its distribution amount since 2022. 

Dominion Energy’s balance sheet is saddled with $41.7 billion in debt as of year-end 2024. The company is managing it well and whittling away at that amount, as it is down 5.6% year-over-year. It’s not unusual for utility companies to carry loads of debt given the capital-intensive natures of building energy infrastructure. 

Nevertheless, debt cuts into the company’s cash flow for from financing activities, as a result of which that line item fell by $2.4 billion in 2024. At the end of 2024, there was $365 million in cash, restricted cash and equivalents on Dominion’s balance sheet, according to the annual report. The outlook on Dominion’s debt by credit rating agencies is stable.  

On the plus side, Dominion Energy reported net income of $2.1 billion in 2024, up from $2 billion year-over-year, even in the face of some extreme weather in its regulated service areas. The stock is about flat over the past 12 months and is included among the portfolios of big investors like Vanguard Group, BlackRock and JPMorgan Chase.

Southern Co Dividend Analysis 

Dividend Amount:  $0.74
Dividend Frequency: Quarterly 
Dividend Yield: 3.2% 

Southern Co., an energy provider in the Southeastern U.S. serving 9 million customers, has been paying uninterrupted dividends to shareholders for close to eight decades, the most recent one of which was announced in early 2025. Every dividend has been either equal to or higher than the previous one, demonstrating a commitment to returning shareholder value to investors.

Southern Co. most recently increased its dividend in 2025, raising by 2.8% to $0.74 per share, payable in June, marking the 24th straight year in which it raised its distribution. Over the past 12 months, Southern’s stock price has returned 20%, giving shareholders yet another incentive to hold the stock. The company’s Southern Telecom subsidiary recently grabbed headlines when it announced it had inked its biggest fiber deal so far, comprising a whopping 300-mile fiber contract with what it described as a “strategic hyperscale customer.” 

Southern Co.’s dividend yield rests at 3.2%, which while below that of Dominion Energy still surpasses the average S&P 500 company’s distribution. Management considers Southern’s dividend strategy an “integral part of its value proposition for shareholders,” saying on the latest earnings call, “we project continued modest increases in the dividend over our forecast horizon.” 

The company boasts strong investment-grade ratings from the credit agencies and has forecast long-term adjusted EPS growth of 5% to 7%, buttressed by “state-regulated electric and gas utility rate base growth of 7%,” per the company’s annual report. Southern Co. has $66.2 billion in debt on its balance sheet, which is offset by $1.0 billion in cash and short-term investments.

Southern Co. stock is held by major institutional investors across their funds, including Vanguard Group, BlackRock and StateStreet, which given the size of their holdings collect big dividend checks every quarter.

Bottom Line

In the heightened uncertain economy, with tariffs and recession looming, investors are looking for some stability. Both Dominion Energy and Southern Co. provide that in their own unique ways.

With Dominion, shareholders earn a generous dividend yield through which have been able to count on receiving steady cash payments, with no signs of any interruption in sight. With Southern Co., shareholders earn growing dividends from a company that prides itself on returning value to investors, not to mention a rising share price as a bonus.

If you want a growing dividend, you might want to lean toward Southern Co, and if it’s yield you’re after then Dominion Energy might be the better bet. Either way, you will be adding defensive plays to your portfolio with a historical precedent to continue paying dividends for years

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