Holding a smartphone displaying the Verizon logo against a dark city skyline, the telecommunications giant symbolizes the US-centric network and dividend stability.
Conflicts in the Middle East have shaken markets in the past few weeks, fueling higher oil prices and market uncertainty.
When uncertainty reigns, investors seek safe havens with steady income and strong profits.
Verizon Communications and American Electric Power offer the best of both worlds: stable returns and income, and insulation from Iran conflict.
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The war in Iran has already sent several jolts through the markets. Gas prices are up, tankers are catching fire in the Strait of Hormuz, and crude oil futures are trading like 2021 meme stocks. With the resumption of normal shipping patterns at least a few weeks away, turbulence will continue to work its way through market indices, even in independent energy markets like the US. When geopolitical stress enters the picture, investors often take risk off the table and look for stable stocks that offer yield and minimal volatility.
However, due to the significant influence of the Middle East in international markets, it is important to not only look for stable profits, but also to invest in companies that are particularly resistant to disruption from the Iran war. The two stocks discussed below were chosen because they offer strong dividends and operate primarily in the United States, reducing exposure to Middle East risks. These characteristics make them suitable for risk-averse portfolios if conflicts persist.
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When looking for safe havens amid geopolitical headwinds, investors tend to focus on sectors with predictable returns and limited global exposure. In the current climate, this means that choosing companies with revenue sources is largely independent of the Middle East. Telecoms and utilities are significant, as they offer stable income, healthy benefits, and operations that reduce the risk of Middle East disruptions.
Verizon Communications Inc. (NYSE: VZ ) growth story? Believe it or not, the telecommunications giant is in the midst of a turnaround that surprises even the most optimistic analysts.
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In Q4 2025, the company reported adding 616,000 quarterly postpaid phone nets (best since 2019) and more than 370,000 broadband customers, and the Frontier acquisition added another 16 million wireless and broadband connections to Verizon’s network.
Verizon also reported free cash flow of $20.13 billion for the full year 2025, up from $19.82 billion in 2024.
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The cash flow engine is helping drive dividend growth, which now yields 5.45% annually with a 68% dividend payout ratio.
Only 30% of cash flow is needed to support the dividend, and Verizon has raised payouts for 20 consecutive years. Telecom is another sector where low growth and predictable profits add to its appeal during troubled times.
100% of Verizon’s revenue is in the United States and is not affected by shipping disruptions in the Middle East. The only concern for Verizon will be rising energy prices, but that’s a relatively small line item in the company’s operating expenses, especially in single-digit percentage terms. Despite the weak sentiment, US consumers remain in good shape to pay their cable and phone bills, because let’s face it – the last thing Americans want is to reduce their access to the Internet.
The VZ stock chart shows a post-earnings breakout, which created a golden cross formation.
Can you spot the spot on the chart where the earnings news fell? Shares of VZ rose 11% following their Q4 report, then tacked on another 12% over the next three weeks. The big move has created a golden cross at the 50- and 200-day moving averages, but also sent the Relative Strength Index (RSI) into overbought territory. Now that the parabolic momentum is gone, shares are consolidating around the $50 level while the RSI is moving back to a healthy range. Verizon’s Q4 earnings changed the outlook for the stock, and now there’s an opportunity for upside with solid dividend earnings.
The utilities sector is a popular place to invest during geopolitical unrest, thanks in large part to its consistent dividend payouts and minimal volatility.
American Electric Company (NASDAQ: AEP) is an Ohio-based regional utility that serves 11 states and supplies electricity to residential and business customers. The turmoil in the Middle East is already affecting natural gas prices, but America’s electricity mix of different supplies of natural gas, coal, nuclear and renewables is contributing to price shocks in each commodity.
Regulated utilities also have adjustment clauses that pass through fuel increases to ratepayers, and the company has little leverage in shipping or commodity trading that could affect short-term margins.
The company reported strong Q4 2025 results on February 12, with operating EPS of $5.97, beating analysts’ expectations, and Q4 revenue exceeding forecasts. Management’s 2026 EPS guidance points to 7%-9% revenue growth. Investors also benefit from a 2.9% yield and a 57% payout ratio. The company has raised payouts for 15 straight years, growing dividends at an annual rate of 5.7% over five years.
The AEP stock chart is showing strong support at the stock’s 50-day SMA.
In addition to its value proposition, AEP also boasts one of the best looking charts that share seekers can ask for. The stock is in the midst of a long-term rally, which has seen shares rise more than 28% over the past 12 months. With strong support at the 50-day moving average and the RSI back below the overbought threshold of 70, AEP shares could strengthen for the next leg in the trend.
The article “2 stocks insulated from Middle East conflict” was originally published by MarketBeat.
