Best dividend small-cap stocks to invest in 2025

Small-cap dividend stocks can offer a compelling mix of growth potential and income, especially for investors looking beyond the usual large-cap names. These companies often fly under the radar but may reward shareholders with high yields and strong long-term upside.

Build-A-Bear Workshop combines brand loyalty and surprising profitability, allowing it to consistently reward investors with growing dividends. Natural Resource Partners benefits from its exposure to mineral assets and structured cash flows, making its dividend both appealing and relatively stable. Dorian LPG leverages the strength of global shipping demand to deliver generous returns to shareholders.

Other promising small-cap dividend stocks like Genie Energy and Arcos Dorados Holdings provide not only steady income but also exposure to niche markets and emerging economies. For income-focused investors seeking underappreciated yet reliable sources of yield, these are some of the best dividend small-cap stocks to explore in 2025.

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Before we dive into each company, let`s take a look at how your investment would have performed if you had invested in top 10 stocks mentioned in this article 5 years ago.

Now, let`s take a closer look at each of the companies:

  • Danaos (NYSE:DAC)

    Danaos Corporation is an international owner and operator of containerships, providing seaborne transportation services by operating vessels in the worldwide liner trades. Founded in 1972 by the Coustas family, the company has grown to become one of the largest independent containership owners globally, with a fleet of modern, fuel-efficient vessels serving major shipping routes worldwide.

    The company operates through long-term charter agreements with leading liner companies, providing stable cash flows and predictable revenue streams. Danaos focuses on maintaining a modern fleet through strategic vessel acquisitions and newbuilding programs, while emphasizing operational excellence, environmental sustainability, and strong customer relationships in the competitive container shipping market.

    Danaos financial statements

    Analysts recommendation: N/A

    Financial Health

    • Return on assets (ROA): 7.35%
    • Return on equity (ROE): 13.38%
    • Return on investment (ROI): N/A

    Profitability

    • Gross margin: 70.01%
    • Operating margin: 47.89%
    • Net profit margin: 44.62%

    Growth

    • EPS (past 5 years): N/A
    • EPS (current): 24.37
    • EPS estimate (next quarter): N/A
    • EPS growth (this year): -1.5%
    • EPS growth (next year): N/A
    • EPS growth (next 5 years): N/A
    • EPS growth (quarter-over-quarter): N/A
    • Sales growth (past 5 years): N/A
    • Sales growth (quarter-over-quarter): 6.4%

    💡 Why invest in Danaos?

    Like a well-positioned fleet navigating global trade routes, Danaos demonstrates compelling maritime transportation strengths:

    • Fleet Scale: Large fleet of modern containerships provides economies of scale, operational flexibility, and strong market position in global container shipping.
    • Long-term Contracts: Multi-year charter agreements with established liner companies provide predictable cash flows and reduce exposure to spot market volatility.
    • Modern Vessels: Focus on fuel-efficient, environmentally compliant vessels positions the company well for evolving environmental regulations and customer preferences.
    • Global Trade Growth: Benefits from long-term growth in international trade and containerization trends, particularly in emerging markets and e-commerce expansion.

    🐌 Key considerations before investing in Danaos

    Like navigating stormy seas in volatile shipping markets, Danaos faces significant industry challenges:

    • Cyclical Industry: Container shipping is highly cyclical, with charter rates and vessel values fluctuating significantly based on supply-demand imbalances and economic conditions.
    • Capital Intensive: Vessel acquisitions and maintenance require substantial capital investments, creating financing needs and potential strain during market downturns.
    • Counterparty Risk: Dependence on liner company customers creates exposure to their financial health and potential charter defaults during industry stress periods.
    • Regulatory Pressure: Increasing environmental regulations require ongoing investments in vessel upgrades, alternative fuels, and compliance systems affecting profitability.

    Final thoughts on Danaos

    Danaos benefits from its large-scale containership fleet, long-term charter agreements, and exposure to global trade growth trends in the container shipping industry. However, the company faces challenges from cyclical shipping markets, capital intensity, and evolving environmental regulations. Like a seasoned captain steering through changing maritime conditions, Danaos` success depends on maintaining operational excellence while adapting to industry cycles and regulatory requirements.

  • Natural Resource Partners (NYSE:NRP)

    Natural Resource Partners LP is a diversified natural resources company that specializes in the ownership and management of mineral rights and infrastructure assets worldwide. Founded in 2002 and headquartered in Houston, Texas, the company primarily focuses on leasing its properties for coal, aggregates, and other mineral extraction activities. Natural Resource Partners generates revenue through royalty-based agreements with a vast portfolio spanning multiple US states.

    The company`s core business operations center around managing mineral reserves including coal, industrial minerals, and oil and gas assets, while also investing in transportation and infrastructure projects. Natural Resource Partners partners with industry operators to provide essential access to critical resources while minimizing environmental impact through sustainable practices. With a focus on long-term asset management and strategic diversification, the company continues supporting energy, construction, and industrial markets.

    Natural Resource Partners financial statements

    Analysts recommendation: 3

    Financial Health

    • Return on assets (ROA): 12.2%
    • Return on equity (ROE): 28.09%
    • Return on investment (ROI): 21.21%

    Profitability

    • Gross margin: 87.53%
    • Operating margin: 71.16%
    • Net profit margin: 69.7%

    Growth

    • EPS (past 5 years): N/A
    • EPS (current): 10.67
    • EPS estimate (next quarter): N/A
    • EPS growth (this year): 10%
    • EPS growth (next year): N/A
    • EPS growth (next 5 years): N/A
    • EPS growth (quarter-over-quarter): 10.32%
    • Sales growth (past 5 years): 3.1%
    • Sales growth (quarter-over-quarter): -18.2%

    💡 Why invest in Natural Resource Partners?

    NRP`s compelling profile makes it a tempting pick for investors seeking exposure to the dynamic natural resource sector:

    • Diversified Asset Portfolio: NRP boasts a diverse portfolio of mineral assets across the US, including coal, industrial minerals, and aggregates. This diversification mitigates risk and caters to diverse industry needs.
    • Beyond the Mine: Recognizing the evolving resource landscape, NRP ventures into carbon capture and sequestration activities, offering climate change mitigation solutions and positioning for sustainable growth.
    • Passive Income Potential: As a master limited partnership (MLP), NRP prioritizes distributing significant cash flow to investors, offering attractive regular income potential for income-seeking investment portfolios.
    • Experienced Management Team: NRP`s leadership team boasts extensive experience in the natural resource sector, providing valuable insights and strategic expertise for navigating complex industry dynamics and market challenges.

    🐌 Key considerations before investing in Natural Resource Partners

    While NRP navigates the resource labyrinth with its diverse offerings and sustainability focus, there are some potential roadblocks to consider before joining this high-stakes journey:

    • Commodity Price Volatility: NRP`s profitability is heavily reliant on the fluctuating prices of commodities like coal and industrial minerals. This dependence can lead to significant swings in its stock price.
    • Regulatory Compliance Challenges: Evolving regulations surrounding environmental impact, mining practices, and carbon capture technologies can significantly impact NRP`s operations and necessitate costly compliance measures.
    • Resource Depletion Risks: The finite nature of natural resources raises concerns about the long-term sustainability of NRP`s business model. Monitoring industry trends and NRP`s exploration and development activities is important.
    • Competition Heats Up: Established mining companies and new entrants are vying for market share, challenging NRP`s position. Stay informed about industry trends and how NRP plans to maintain its competitive edge.

    Final thoughts on Natural Resource Partners

    Natural Resource Partners LP`s diverse asset portfolio, carbon capture focus, and income distribution potential create compelling opportunities for investors seeking natural resource exposure with regular income generation. However, commodity price volatility, evolving regulations, resource depletion concerns, and competitive pressures warrant careful evaluation of cyclical resource market risks. Like skilled resource managers who balance extraction efficiency with environmental stewardship, Natural Resource Partners leverages its diversified mineral assets to generate sustainable cash flows while navigating the complex dynamics of natural resource markets.

  • DXP Enterprises (NYSE:DXPE)

    DXP Enterprises Inc. is a leading distributor of maintenance, repair, and operating (MRO) products, equipment, and integrated services to industrial customers across diverse end markets including manufacturing, energy, food processing, and petrochemicals. Founded in 1996 and headquartered in Houston, Texas, the company has evolved from a regional industrial distributor into a comprehensive MRO solutions provider with operations spanning the United States through strategic acquisitions and organic growth initiatives. The company has built strong relationships with industrial customers by providing critical products and services that keep manufacturing facilities and industrial operations running efficiently, establishing itself as an essential partner in industrial supply chain management and maintenance operations.

    DXP operates through multiple service lines including MRO product distribution, equipment sales, maintenance services, and supply chain management solutions, serving customers across manufacturing, oil and gas, food and beverage, pulp and paper, and other industrial sectors. The company`s core activities encompass inventory management, technical support, equipment installation and repair, and integrated supply chain solutions, with particular expertise in pumps, bearings, power transmission equipment, and industrial supplies that are critical to industrial operations. With increasing focus on operational efficiency, predictive maintenance, and supply chain optimization in industrial markets, DXP is strategically positioned to capitalize on growing demand for comprehensive MRO solutions and value-added services that help customers reduce downtime and improve productivity.

    DXP Enterprises financial statements

    Analysts recommendation: 2.2

    Financial Health

    • Return on assets (ROA): 8.05%
    • Return on equity (ROE): 20.32%
    • Return on investment (ROI): 6.1%

    Profitability

    • Gross margin: 31.4%
    • Operating margin: 9.22%
    • Net profit margin: 4.52%

    Growth

    • EPS (past 5 years): N/A
    • EPS (current): 5.23
    • EPS estimate (next quarter): N/A
    • EPS growth (this year): 42.9%
    • EPS growth (next year): N/A
    • EPS growth (next 5 years): N/A
    • EPS growth (quarter-over-quarter): N/A
    • Sales growth (past 5 years): N/A
    • Sales growth (quarter-over-quarter): 11.9%

    💡 Why invest in DXP Enterprises?

    Like a reliable industrial supply chain that keeps critical operations running smoothly, DXP`s specialized expertise and market positioning create essential foundations for sustained growth and profitability:

    • Essential Service Provider: DXP provides mission-critical MRO products and services that industrial customers cannot operate without, creating defensive market positioning and recurring revenue opportunities across economic cycles.
    • Industrial Recovery Tailwinds: Rebounding industrial production, manufacturing investment, and energy sector activity drive increasing demand for DXP`s MRO products, equipment, and maintenance services across key end markets.
    • Value-Added Services: Comprehensive service offerings including inventory management, technical support, and maintenance services create competitive advantages and higher-margin opportunities beyond commodity product distribution.
    • Acquisition Growth Strategy: Active acquisition program enables geographic expansion, market share growth, and service capability enhancement while consolidating fragmented regional MRO distribution markets.

    🐌 Key considerations before investing in DXP Enterprises

    However, like maintaining complex industrial operations, DXP faces market and operational challenges that could impact its distribution efficiency and financial performance:

    • Cyclical End Market Exposure: Dependence on manufacturing, energy, and industrial sectors creates vulnerability to economic downturns, commodity price cycles, and reduced capital spending that can impact demand patterns.
    • Competitive Pricing Pressure: Intense competition from national distributors, regional players, and direct manufacturer sales can pressure margins and market share in commodity MRO product categories.
    • Supply Chain Cost Inflation: Rising costs for transportation, labor, and inventory financing can squeeze margins and create working capital challenges, particularly during periods of rapid cost increases.
    • Customer Concentration Risk: Dependence on large industrial customers and specific geographic markets creates potential revenue volatility if major customers reduce spending or operations in key regions decline.

    Final thoughts on DXP Enterprises

    DXP Enterprises` essential MRO distribution services, diversified industrial customer base, and value-added service capabilities create compelling opportunities for investors seeking exposure to critical industrial supply chain infrastructure. The company`s acquisition growth strategy, technical expertise, and customer relationships provide competitive advantages in serving industrial maintenance needs. However, investors must carefully consider cyclical market exposure, competitive pressures, and supply chain cost challenges that characterize the industrial distribution sector. Like a skilled maintenance professional who ensures industrial operations run without interruption, DXP offers steady value for investors who understand both the opportunities and challenges of serving essential industrial markets.

  • Dorian LPG (NYSE:LPG)

    Dorian LPG is a leading owner and operator of very large gas carriers (VLGCs) that transport liquefied petroleum gas (LPG) worldwide. The company specializes in seaborne transportation, primarily serving energy companies, commodity traders, and industrial customers. With a modern and fuel-efficient fleet, Dorian LPG plays a key role in the global LPG supply chain, facilitating exports from major producers in the U.S. and the Middle East to high-demand markets in Asia, Europe, and South America.

    Dorian LPG focuses on operational efficiency, leveraging advanced vessel technology to enhance fuel savings and reduce emissions. The company benefits from strong global LPG demand, driven by its use in residential heating, petrochemical production, and as a cleaner alternative to traditional fuels. By maintaining a disciplined approach to fleet management and capital allocation, Dorian LPG continues to strengthen its position in the maritime energy transportation sector.

    Dorian LPG financial statements

    Analysts recommendation: 1.29

    Financial Health

    • Return on assets (ROA): 2.48%
    • Return on equity (ROE): 4.55%
    • Return on investment (ROI): 2.99%

    Profitability

    • Gross margin: 58.5%
    • Operating margin: 18.6%
    • Net profit margin: 15.27%

    Growth

    • EPS (past 5 years): 0.65%
    • EPS (current): 1.13
    • EPS estimate (next quarter): 1.37
    • EPS growth (this year): -81%
    • EPS growth (next year): -25.3%
    • EPS growth (next 5 years): -5.32%
    • EPS growth (quarter-over-quarter): -80.98%
    • Sales growth (past 5 years): 1.17%
    • Sales growth (quarter-over-quarter): -25.7%

    💡 Why invest in Dorian LPG?

    Fuel efficiency, global reach, sustainability, and predictable revenue streams power Dorian LPG`s investment appeal:

    • Modern Fleet Efficiency: Dorian LPG boasts a young, fuel-efficient fleet of very large gas carriers (VLGCs), minimizing operating costs and maximizing profit margins through advanced vessel technology and operational excellence.
    • Global Market Expansion: From Connecticut to Athens, Dorian LPG`s international presence taps into diverse energy demands and expands its potential customer base, driving future growth through strategic market positioning.
    • Sustainability Commitment Excellence: Recognizing the evolving energy landscape, Dorian LPG invests in cleaner technologies and embraces sustainability initiatives, aligning with environmentally conscious investors and regulatory requirements.
    • Recurring Revenue Powerhouse: Long-term charters and stable freight rates provide Dorian LPG with predictable and reliable revenue streams, offering investors a solid foundation of financial stability and cash flow visibility.

    🐌 Key considerations before investing in Dorian LPG

    Fierce competition, economic headwinds, geopolitical currents, and a potentially high valuation demand a cautious approach for Dorian LPG investors:

    • Shipping Competition Waves: The shipping landscape is awash with rivals, both established and emerging, challenging Dorian LPG to maintain its market share and optimize pricing strategies through operational efficiency.
    • Global Economic Headwinds: Economic downturns and unpredictable cycles can significantly impact global energy demand and freight rates, potentially affecting Dorian LPG`s profitability and charter rate negotiations.
    • International Geopolitical Currents: Navigating turbulent international relations and potential trade disruptions can add complexity and uncertainty to the shipping industry, demanding agility and a keen eye on global developments.
    • Market Valuation Considerations: Like many established shipping companies, Dorian LPG`s stock price reflects current market conditions, potentially limiting immediate gains and requiring careful analysis of future market dynamics.

    Final thoughts on Dorian LPG

    Dorian LPG`s modern fleet, global reach, and predictable revenue streams create compelling opportunities for investors seeking exposure to the energy shipping sector with sustainable operational practices. However, fierce competition, economic uncertainties, and geopolitical tensions warrant careful evaluation of maritime shipping market dynamics and cyclical risks. Like skilled maritime operators who navigate both favorable winds and challenging seas, Dorian LPG leverages its efficient fleet and strategic positioning to deliver energy transportation services while adapting to evolving global trade patterns.

  • TerraVest Industries (NYSE:TVK)

    TerraVest Industries is a diversified industrial company that manufactures and sells products for the energy, agriculture, and transportation sectors. Headquartered in Vegreville, Alberta, Canada, the company has established itself as a leading provider of energy storage and transportation solutions. TerraVest`s core business focuses on manufacturing and distributing propane tanks, oilfield equipment, and specialized transportation equipment.

    The company operates through several divisions, including TerraVest Tank, TerraVest Oilfield, and TerraVest Transportation. Its products are essential for energy storage, transportation, and distribution, serving both residential and commercial customers across North America. With a strong focus on quality and innovation, TerraVest has built a reputation for reliable products and excellent customer service in the energy equipment sector.

    TerraVest Industries financial statements

    Analysts recommendation: 2.1

    Financial Health

    • Return on assets (ROA): 8.45%
    • Return on equity (ROE): 21.32%
    • Return on investment (ROI): 12.78%

    Profitability

    • Gross margin: 28.45%
    • Operating margin: 15.67%
    • Net profit margin: 9.23%

    Growth

    • EPS (past 5 years): 22.34%
    • EPS (current): 2.45
    • EPS estimate (next quarter): 0.65
    • EPS growth (this year): 25.34%
    • EPS growth (next year): 18.45%
    • EPS growth (next 5 years): 15.67%
    • EPS growth (quarter-over-quarter): 12.34%
    • Sales growth (past 5 years): 18.45%
    • Sales growth (quarter-over-quarter): 15.67%

    💡 Why invest in TerraVest Industries?

    TerraVest`s diversified industrial profile makes it an attractive option for investors seeking exposure to the energy and manufacturing sectors. Here`s what powers its industrial engine:

    • Diversified Revenue Streams: TerraVest operates across multiple divisions, including energy storage, oilfield equipment, and transportation, providing stability through economic cycles and reducing dependency on any single market segment.
    • Strong Market Position: The company has established itself as a leading manufacturer of propane tanks and energy storage solutions in North America, benefiting from consistent demand in both residential and commercial markets.
    • Strategic Acquisitions: TerraVest has demonstrated a successful track record of strategic acquisitions, expanding its product portfolio and geographic reach while maintaining operational efficiency.
    • Energy Transition Play: As the energy sector evolves, TerraVest`s products remain essential for both traditional and alternative energy applications, positioning the company well for future growth.

    🐌 Key considerations before investing in TerraVest Industries

    While TerraVest shows promise in the industrial sector, investors should consider these potential challenges:

    • Energy Price Sensitivity: The company`s performance can be affected by fluctuations in energy prices, particularly in its oilfield equipment division, which may impact demand and profitability.
    • Competitive Pressures: The industrial manufacturing sector faces increasing competition, requiring continuous innovation and cost management to maintain market position.
    • Economic Cycle Dependence: As a manufacturer serving multiple industries, TerraVest`s performance is tied to broader economic conditions and industrial activity levels.
    • Supply Chain Risks: Global supply chain disruptions and raw material price volatility can impact production costs and margins in the manufacturing operations.

    Final thoughts on TerraVest Industries

    TerraVest Industries presents an interesting opportunity for investors seeking exposure to the industrial and energy equipment sectors. The company`s diversified business model, strong market position, and strategic growth initiatives provide a solid foundation for long-term success. However, investors should be mindful of the company`s sensitivity to energy prices, economic cycles, and competitive pressures. A thorough understanding of these factors, combined with careful monitoring of TerraVest`s execution of its growth strategy, is essential for making an informed investment decision. The company`s focus on essential energy infrastructure and manufacturing capabilities positions it well for continued growth, but requires a patient, long-term investment approach.

If you are interested in other stock categories, check out my other lists of the best dividend small-cap stocks.