Is 2026 the Year of Dividend Stocks? These 2 Income-Focused ETFs Have Been Soaring Past the S&P 500

By David Jagielski, CPA – Feb 10, 2026 at 12:00PM ESTKey PointsThe iShares Select Dividend ETF and the Schwab U.S. Dividend Equity ETF have been hot buys to start 2026.A few high-flying stocks have been giving these ETFs a boost.These funds hold around 100 stocks can can provide investors with some excellent dividend income.These 10 Stocks Could Mint the Next Wave of Millionaires ›NYSEMKT: SCHDSchwab U.S. Dividend Equity ETFToday's Changeangle-down(0.10%) $0.03Current Price$31.38Price as of February 10, 2026 at 1:41 PM ETThese funds both pay more than 3% and have been beating the market this year.In previous years, investors have been focused on growth stocks and high-powered tech companies. But in 2026, there appears to have been a clear change in strategy for investors. Rather than continuing to chase high-valued stocks, investors have been focusing more on dividend stocks. Since the start of the year, the S&P 500 has risen by less than 2%, and the Roundhill Magnificent Seven ETF, which includes the top tech stocks in the "Magnificent Seven," is down more than 3%. What's surprising is that it's been dividend stocks that have been the better buys of late. The iShares Select Dividend ETF (DVY +0.43%) and the Schwab U.S. Dividend Equity ETF (SCHD +0.10%) are both beating the market, and it's not even close. Here's how well they've been doing thus far and why they can be great options for income investors today. Image source: Getty Images. iShares Select Dividend ETF: up 10% This iShares exchange-traded fund (ETF) focuses on U.S. companies that have been paying dividends for at least five years, with the focus being to give investors access to reliable income investments. There are around 100 stocks in the ETF, and one of the big reasons it's been doing well is that its top holding is Seagate Technology, which accounts for just under 4% of the fund's portfolio. The data storage stock has benefited from rising demand for its products as a result of an increase in tech spending. Year to date, Seagate's stock is up more than 50%, which has given the iShares Select Dividend ETF a boost along the way. There are other quality dividend stocks in the ETF; they simply may not be as flashy or exciting as Seagate right now. Pfizer and Verizon Communications are top stocks in the fund as well, and can be quality investments to hold for the long term. ExpandNASDAQ: DVYiShares Trust - iShares Select Dividend ETFToday's Change(0.43%) $0.67Current Price$155.73Key Data PointsDay's Range$154.89 - $155.9352wk Range$115.94 - $155.93Volume176K Overall, this can be a solid income-generating ETF to hang on to, with the iShares fund yielding around 3.4%, which is more than three times the S&P 500 average of 1.1%. The ETF's expense ratio of 0.38% also isn't terribly high. Schwab U.S. Dividend Equity ETF: up 13% The Schwab U.S. Dividend Equity ETF has been an even hotter investment to own this year, and it too has benefited from a couple of high-flying stocks being among its largest holdings. Lockheed Martin and Texas Instruments each make up more than 4% of the ETF's holdings, and both of these stocks are up more than 25% for the year, as of Monday's close. ExpandNYSEMKT: SCHDSchwab U.S. Dividend Equity ETFToday's Change(0.10%) $0.03Current Price$31.38Key Data PointsDay's Range$31.22 - $31.3952wk Range$23.87 - $31.49Volume492K At 3.5%, the Schwab fund offers investors an excellent yield, and its expense ratio is just 0.06%, making it an ideal low-cost option. Like the iShares fund, it also has around 100 holdings in its portfolio, providing investors with some great diversification. The fund's focus on quality dividend stocks with sustainable payouts makes this a suitable investment to hang on to for the long haul.Read NextFeb 10, 2026 •By Eric TrieBuilding Dividend Income: A Steadier Approach or a Higher-Paying One With VYM and SCHDFeb 9, 2026 •By Dave KovaleskiSchwab vs Vanguard: Which is the Better Dividend ETF?Feb 7, 2026 •By Robert IzquierdoBetter Dividend ETF: Schwab's SCHD vs. Vanguard's VYMFeb 7, 2026 •By Jake LerchDividend ETFs: SCHD Offers Higher Yield but VIG Leads in Capital GrowthFeb 2, 2026 •By Matt DiLalloThe First 3 Passive Income Investments I Plan to Make In FebruaryFeb 2, 2026 •By Reuben Gregg BrewerWith $500 to Invest, This Dividend ETF Could Create Steady Cash Flow for YearsAbout the AuthorDavid Jagielski, CPA, has been a contributing Motley Fool stock market analyst covering healthcare, consumer staples, consumer discretionary, and technology stocks since 2017. David has more than 10 years of experience in finance roles across businesses of different sizes and sectors. He holds a Certified Public Accountant designation in Canada.TMFdjagielskiStocks MentionedSchwab U.S. Dividend Equity ETFNYSEMKT: SCHD$31.38 (+0.10%) $+0.03Verizon CommunicationsNYSE: VZ$47.77 (+1.58%) $+0.74Texas InstrumentsNASDAQ: TXN$221.40 (+1.20%) $+2.63PfizerNYSE: PFE$27.51 (+1.72%) $+0.46iShares Trust - iShares Select Dividend ETFNASDAQ: DVY$155.73 (+0.43%) $+0.67Lockheed MartinNYSE: LMT$635.65 (0.41%) $2.64Seagate Technology PlcNASDAQ: STX$397.21 (6.54%) $27.79Roundhill Magnificent Seven ETFNYSEMKT: MAGS$63.72 (0.19%) $0.12*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.