Morgan Stanley has an ‘overweight’ rating on these 3 stocks yielding up to 9.1% — nail them down in case inflation soars even higher

With high-flying growth stocks making all of the headlines, dividend stocks often get ignored.

But in a world of historically low interest rates and 31-year high inflation, a steady and growing stream of dividends can help risk-averse investors sleep better at night.

Healthy dividend stocks have the potential to:

Offer a plump income stream in both good times and bad times.
Provide much-needed diversification to growth-oriented portfolios.
Outperform the S&P 500 over the long haul.

Let’s take a look at three dividend stocks that Wall Street giant Morgan Stanley has given an overweight rating to.

Microsoft Corp. (MSFT)

Microsoft sign at the headquarters for the cloud computer and software company. — VDB Photos/Shutterstock

Tech stocks aren’t exactly known for their dividends. But the ones with massive recurring cash flows and healthy balance sheets can still deliver solid cash payouts to shareholders.

Take Microsoft, for instance.

When the tech giant first started paying quarterly dividends in 2004, it was paying investors 8 cents per share. Today, Microsoft’s quarterly dividend rate stands at 62 cents per share, marking a total payout increase of 675%.

The stock currently offers a dividend yield of only 0.8%. But given Microsoft’s highly reliable dividend growth — management has raised the payout for 12 straight years — it remains an attractive choice for income investors.

Morgan Stanley reiterated an overweight rating on Microsoft late last year and raised the price target on the stock to $364, about 17% worth of upside from current levels.

Microsoft currently trades at around $311 per share. But you can own a piece of the company using trading apps that allow you to buy fractions of shares with as much money as you are willing to spend.

Procter & Gamble (PG)

Bottles of Procter & Gamble's Tide detergent in a supermarket in New York — rblfmr/Shutterstock

Procter & Gamble belongs to a group of companies often referred to as the Dividend Kings: publicly traded businesses with at least 50 consecutive years of dividend increases.

In fact, P&G makes the list with ease.

In April, the board of directors announced a 10% increase to the quarterly payout, marking the company’s 65th consecutive annual dividend hike.

It’s not hard to see why the company is able to maintain such a streak.

P&G is a consumer staples giant with a portfolio of trusted brands like Bounty paper towels, Crest toothpaste, Gillette razor blades and Tide detergent. These are products that households buy on a regular basis, even when the economy is doing poorly.

Thanks to the recession-proof nature of P&G’s business, it can deliver reliable dividends through thick and thin.

Morgan Stanley raised its price target on the shares to $161 in September. The stock currently offers a dividend yield of 2.1%.

MPLX (MPLX)

pipeline construction in the Permian Basin — G B Hart/Shutterstock

MPLX isn’t a household name like Microsoft or P&G. But for the serious yield-hunters, it’s a stock that probably shouldn’t be ignored.

Headquartered in Findlay, Ohio, MPLX is a master limited partnership created by Marathon Petroleum to own, operate, develop and acquire midstream energy infrastructure assets.

The partnership pays quarterly cash distributions of 70.50 cents per unit. With the stock trading just above $29, that translates into a chunky annual dividend yield of 9.1%.

Morgan Stanley raised its price target on MPLX to $37 late last year, about 20% worth of upside from where the stock sits today.