Key Points
- Hormel Foods is trading near long-term lows with a dividend yield of 3.85%, signaling a potential turnaround supported by improving margins and renewed growth.
- Genuine Parts Company currently offers an elevated 3.4% dividend yield, benefiting from robust car parts demand and a strong record of dividend growth.
- Procter & Gamble delivers a stable dividend yield of 2.66% and maintains financial strength, thanks to its sustainable 67.14% payout ratio and reliable cash flows.
Dividend Kings—companies that have raised their dividends for 50+ consecutive years—are generally a good buy anytime. But, as they say, it’s best to buy them when they are down so you can sell them when they are high.
Right now, three high-quality Dividend Kings are trading near long-term lows, offering values and yields not often seen. These aren’t broken businesses—just temporarily out-of-favor stocks poised for recovery. While the rebound may take time, their bottoms are in, and the downside is limited, giving investors a window to build positions before prices climb. But that window won’t stay open forever.
1. Hormel Foods: Positioned for Recovery
Hormel (NYSE: HRL) has struggled with sluggish sales and margin pressures over the last few years, but is emerging from the tough times in a better operating condition.
The latest earnings report revealed that it returned to growth and improved margins, news that led analysts to issue positive sentiment and price target revisions.
The takeaway from the analyst activity is that the downtrend in sentiment and price target revisions has ended; this stock is no longer a Sell but a Buy, with a 10% upside potential at the consensus. The revisions suggest a high likelihood that the stock price will move into the high-end range and continue to rise.
The catalyst for the move could come with the upcoming earnings report. Analysts have set a low bar with their revisions, with nearly 100% of them including reduced targets, and consumer trends remain positive. Although the May retail sales data showed sales declined sequentially, the year-over-year (YOY) comparisons were strong, suggesting strength will also be seen in results from companies like Hormel.
In the longer term, Hormel is expected to sustain a modest single-digit growth pace with solid margins, enabling it to maintain its dividend and distribution growth trends. The caveat for investors is that Hormel’s distribution growth pace is slowing and is likely to continue doing so due to the payout ratio. The payout ratio is running near 85% leaving little room for anything but dividend payment. As it stands, the company can reinvest in the business while maintaining a healthy balance sheet.
2. Genuine Parts Company: 30% More Yield Than Average
Genuine Parts Company’s (NYSE: GPC) dividend yields about 3.4% in late June. That is a solid yield for any Dividend King but a high yield for this stock, which has averaged about 2.7% over the past five and 10-year periods.
Analysts are less vocal, but their activity aligns with a bottom for the market, including noteworthy upgrades and price target revisions earlier in the year.
Among the headwinds is the unknown headwind of tariffs; however, the analysts’ low bar is likely to be easily beaten in the upcoming earnings report. The car parts market is thriving because it enables Americans to keep their cars running for longer periods.
The takeaway for investors is that the analyst sentiment firmed to Moderate Buy from Hold this year, and the consensus reported by MarketBeat forecasts a 10% upside in addition to the yield. The upside potential is likely to increase as time progresses, driven by the long-term outlook, which includes sustained, modest revenue growth and widening margins.
3. The Procter & Gamble Company: No Gamble for Investors
The Procter & Gamble Company (NYSE: PG) is no gamble for investors, sustaining long-term growth due to its commanding presence in numerous consumer verticals.
The price action in 2025 has the PG stock market at a long-term low and the yield at the high end of its historic range, near 2.65%.
The yield is safe at 65% of the earnings due to the quality operation. The balance sheet carries debt, but it is relatively low and manageable, and the cash flow is reliable.
Procter & Gamble is also able to buy back shares. The buyback reduced the count by nearly 1% on average in FQ3 and is expected to continue robustly in FQ4 and the subsequent fiscal year.
Upcoming catalysts include the FQ4 results, which are expected to show growth and margin strength, despite the low bar set by analysts, as 100% of them, tracked by MarketBeat, have reduced their target since the last report. Procter & Gamble is expected to grow revenue at a mid-single-digit pace over the long term and to widen its margin. Analysts have given this stock a consensus Moderate Buy; the sentiment rating is firm, coverage is rising, and the price target is steady, forecasting about 10% upside this year.
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About Thomas Hughes
Experience
Thomas Hughes has been a contributing writer for DividendStocks.com since 2019.
- Professional Background: Thomas Hughes is the Managing Partner of Passive Market Intelligence LLC, a market research platform he launched in 2023 with the mission: “We watch the market so you don’t have to.” He has worked as a blogger, stock market commentator, and independent analyst since 2010 and has been actively involved in trading and investing since 2005.
- Credentials: He holds an Associate of Arts in Culinary Technology—training that honed his discipline, attention to detail, and ability to anticipate outcomes, all of which carry over into his work as a market analyst.
- Finance Experience: Thomas has been writing about finance and investing since 2011, when he discovered it could be more than a personal passion—it could be a profession. He’s been a contributing writer for DividendStocks.com since 2019.
- Writing Focus: He specializes in the S&P 500, small-cap stocks, dividend and high-yield strategies, consumer staples, retail, technology, oil, and cryptocurrencies. His analysis blends chart-based technical setups with key fundamental insights, helping readers identify actionable trends.
- Investment Approach: Thomas takes a hybrid approach that combines technical analysis with deep fundamental research. He often writes about macroeconomic shifts, earnings trends, and sentiment-based trading signals.
- Inspiration: Thomas first became interested in stocks after attending a seminar on how to buy and sell your own shares. That event opened his eyes to the market’s potential and sparked a lifelong interest in investing.
- Fun Fact: Thomas took up model railroading by accident a few years ago—and now he can’t stop running the rails.
- Areas of Expertise: Technical and fundamental analysis, S&P 500, retail and consumer sectors, dividends, market trends
Education
Associate of Arts in Culinary Technology
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