My investment portfolio is designed around a strategy that includes a 20-to-30-year outlook. This plays an important role in what I look for when identifying dividend stocks to buy, because they need to exhibit long-term resilience.
However, even the most established companies face challenges and unexpected headwinds as time passes. This necessitates an occasional reassessment of my portfolio to ensure the long-term holdings are still viable.
Two that I’m looking at today are British American Tobacco (LSE: BATS) and MONY Group (LSE:MONY).
British American Tobacco
British American Tobacco was founded in 1902 and sells cigarettes, vapour, heated and modern oral products, including Vuse, glo and Velo. Its scale is substantial: the company profile records 47,797 employees and operations across multiple regions.
That reach matters because weaker cigarette volumes in one market need not translate directly into falling group cash flow.
The latest figures certainly help reinforce my conviction – for 2025, revenue was £25.61bn, operating profit £9.997bn and free cash flow £4.362bn.
Key metrics:
- Share price: 4,154p
- Market cap: £89.6bn
- Price-to-earnings (P/E) ratio: 14.36
- Trailing dividend yield: 6%
Those are decent numbers, but they don’t overshadow the elephants in the room: the ethical issue and also the ‘less-harmful’ transition.
Cigarettes remain the core cash driver but regulation, taxation, and changing behaviour add structural risks. ‘Next-gen’ products like vapes add promise for the future, but competition, regulation and execution risk are high.
I still see the income potential to consider with this one, but it’s no longer the set-and-forget growth and income gem it once was. Can management replace lost combustible revenue without weakening the balance sheet or dividend? Only time will tell.
MONY Group
MONY Group is an entirely different beast. The digital platform helps people save money, with divisions including Money, Insurance, Travel, Home Services and MoneySavingExpert. Founded in 1993, the group has remained a small outfit with fewer than 1,000 employees.
Its model is less capital-intensive than tobacco manufacturing: it attracts consumers, compares offers and earns revenue from commercial relationships.
The latest 2025 figures show a smaller business with strong cash conversion:
- Share price: 210p
- Market cap: £1.06bn
- Revenue: £446.3m (up from £439.2m)
- Operating profit: £117.4m (up from £113.3m)
- Free cash flow: £104.1m (up from £101m)
Valuation-wise, its P/E ratio is moderate at 13.51 and its trailing dividend yield remains attractive at 6.13%.
For a 20-to-30-year portfolio, it offers exposure to digital consumer finance and trusted brands. However, comparison websites face stiff competition, regulation and changing search economics.
The company must keep attracting users and turning attention into profitable transactions. That makes it more growth-sensitive than British American, and potentially more vulnerable to a poor strategic decision.
My conclusion
I think both stocks still have sufficient long-term income potential and deserve a closer look. But I won’t say either is a ‘top’ pick. Regulatory headwinds threaten cigarette makers, while MONY Group’s future depends on remaining relevant in a competitive market. That’s why diversification is key.
For investors considering new income stocks, always look closely at dividend cover, debt, customer trends and management guidance.
For me, the decision isn’t simply yield versus growth. It’s whether a business can navigate the unexpected twists and turns that inevitably lie ahead. That’s the real question long-term investors must keep asking, year after year.
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Mark Hartley owns shares in MONY Group and British American Tobacco.
This story originally appeared on Motley Fool
