In the investment world, the allure of high-yield dividend stocks is undeniable, especially when they are trading near their yearly lows.
Such stocks promise attractive dividends and also hold the potential for price appreciation. In this context, PepsiCo, Kimberly-Clark, and Unilever stand out as compelling choices for an investment of $5,000.
PepsiCo: A Diversified Investment Option
PepsiCo, the renowned soft drink and snack giant, represents a diversified investment opportunity. Known globally for its Pepsi products, the company has been expanding through strategic acquisitions, bolstering its growth prospects.
As per the latest earnings report in October, PepsiCo’s organic revenue growth rate stood at an impressive 11.8%, with core earnings per share, excluding foreign exchange impacts, climbing 16% year-over-year.
The company’s ability to pass along the rising costs to consumers without significant volume drops is reflected in its robust top and bottom-line results. Despite this, PepsiCo shares have been relatively flat over the past year, raising concerns about its continued growth reliant on price increases.
However, its strong brand and diverse product range make it an attractive investment.
Currently offering a 3% dividend yield, a $5,000 investment in PepsiCo could generate $150 in annual dividend income.
Moreover, as a Dividend King, the potential for dividend growth enhances its appeal. Trading within 10% of its 52-week low of $155.83, now is an opportune time to consider adding PepsiCo to your portfolio.
Kimberly-Clark: Consistency in Dividend Growth
Another noteworthy Dividend King is Kimberly-Clark, known for consistent dividend hikes. On January 24, the company announced a 3.4% increase in its quarterly dividend to $1.22.
This hike brings the yield to 4%, substantially above the S&P 500 average of 1.5%. Investing $5,000 in Kimberly-Clark could yield $200 in annual dividend income.
The company, with popular brands like Huggies and Cottonelle, reported a 5% organic sales growth rate for the year 2023. Although operating profit fell by 13% to $2.3 billion due to impairment charges, the underlying business performance remained strong.
With the stock down 6% in the past 12 months and near its 52-week low of $116.32, Kimberly-Clark is an attractive option for dividend investors seeking stability.
Unilever: A Diverse Portfolio with Growth Potential
Unilever completes this list as a massive entity known for household and personal products. With a portfolio that includes Ben & Jerry’s and Dove, the company reported a 7.7% underlying sales growth in the first nine months of 2023.
Despite relying on price increases and experiencing a 0.6% decline in volume, the company’s stability and yield potential are significant draws for income investors.
Offering a 3.8% yield, a $5,000 investment in Unilever could bring $190 in yearly dividends.
While not a Dividend King, Unilever has a history of increasing payouts, supported by a 52% payout ratio, suggesting room for future dividend growth. Trading close to its 52-week low of $46.16, Unilever is a viable investment choice.
Strategic Investment in The Three Dividend Giants
The discussion of PepsiCo, Kimberly-Clark, and Unilever highlights the value of incorporating high-yield dividend stocks into an investment strategy.
These companies, known for their robust business models and ability to navigate economic fluctuations, offer investors a blend of income and growth prospects.
Investing in such dividend-paying giants allows for a strategic allocation of resources, aiming not just for immediate income but also for long-term asset growth.
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I’m Jackson Hartwell, a writer who specializes in dissecting political events. I’m dedicated to providing you with clear and concise insights into the world of politics, making it easier to understand the latest news and developments.