Best Halal Dividend Stocks for 2026

Are Dividends Halal?

Yes — dividends are generally considered halal. When a company earns profit and distributes a portion to shareholders, this is a legitimate form of profit-sharing (mudarabah principle). Unlike interest (riba), dividends are tied to actual business performance and aren't guaranteed regardless of profit or loss.

What to Look For in Halal Dividend Stocks

• Passes Sharia business activity screens — no alcohol, gambling, riba-based finance, weapons, etc.
• Passes financial ratio screens — debt-to-market-cap under 33%
• Consistent dividend history — ideally 10+ years of uninterrupted payments
• Sustainable payout ratio — dividends should come from genuine earnings, not borrowed money

Top Halal Dividend Stocks in 2026

1. Microsoft (MSFT) — ~0.8% yield

Microsoft pays a growing dividend backed by massive free cash flow from Azure and Office 365. The yield is low but grows consistently. MSFT is among the most widely held stocks in Islamic portfolios.

2. Apple (AAPL) — ~0.5% yield

Apple's dividend is modest but the company returns enormous capital to shareholders. More importantly, Apple is halal-screened and generates genuinely earned profit.

3. ExxonMobil (XOM) — ~3.5-4% yield

One of the highest-yielding halal large-caps. Oil and gas is permissible, and Exxon has a 40+ year history of dividend growth. High yield with strong free cash flow backing.

4. Chevron (CVX) — ~3.5-4% yield

Like Exxon, Chevron is a halal-compliant energy major with a long dividend history. Slightly more conservative balance sheet than Exxon.

5. Johnson & Johnson (JNJ) — ~3% yield

A Dividend King (50+ consecutive years of increases) in the halal-compliant healthcare sector. Stable, growing dividend from a diversified pharmaceutical and medical device business.

6. Pfizer (PFE) — ~5-6% yield

Currently offers one of the highest yields in the healthcare sector as the stock has declined from COVID-era peaks. Halal-compliant with a sustainable payout ratio.

7. NVIDIA (NVDA) — ~0.03% yield

Minimal dividend but massive capital appreciation. Included here because NVDA is halal-compliant and represents the growth side of a balanced halal income strategy.

Dividend Purification

If the company you hold earns some income from borderline activities (within the 5% threshold), you should purify a proportional amount of your dividend. For example, if 2% of a company's revenue comes from interest income, donate 2% of your dividend to charity.

Bottom Line

Halal dividend investing is entirely possible and provides excellent long-term wealth building. Focus on healthcare, technology, and energy sectors where many strong dividend payers also pass Islamic screens.