This year is shaping up to be quite interesting, with the Federal Reserve’s mixed signals on interest rates. Savvy investors look towards high-quality dividend kings to buy for additional income and stability.
While growth stocks have taken off in 2024, there exist both well-known and under-the-radar dividend growth stocks worth investors’ attention. These companies’ impressive track records in increasing their dividend payouts for 50 consecutive years or more demonstrate financial stability, resilience, and a commitment to rewarding their shareholders.
Many of them have continued to increase their dividend and grow revenue and earnings per share amid market uncertainties. By identifying and investing in these dividend kings early, investors can benefit from both capital appreciation and dividend income. Now, let’s discover the top three dividend kings to buy in 2024 before Wall Street catches on.
Procter & Gamble (PG)
Procter & Gamble (NYSE:PG), a household name with a history spanning more than 180 years, is synonymous with trust and quality. The company’s extensive portfolio of consumer brands remains in high demand, even during economic downturns. This has allowed it to continuously return value to shareholders through share buybacks and dividends.
Procter and Gamble’s impressive track record of 68 consecutive years of dividend increases is a testament to its financial stability and commitment to shareholder returns. PG’s focus on innovation and brand building, coupled with its vast distribution network, has allowed it to maintain a strong competitive position. In recent years, the company has streamlined its operations, divesting from non-core brands and focusing on its most profitable segments. This disciplined approach has led to increased revenue growth and margin expansion over the last decade.
Moreover, the company’s healthy balance sheet and strong cash flows provide ample room for dividend growth and potential share buybacks. With a current dividend yield of 2.40%, PG stock remains one of the most compelling dividend kings to buy in 2024.
PepsiCo (PEP)
PepsiCo (NASDAQ:PEP) is another consumer staples giant with a diversified portfolio of food and beverage products. With a remarkable 52-year track record of dividend increases, PepsiCo has consistently delivered value to shareholders.
PepsiCo’s strength lies in its diversified portfolio, which spans beverages, snacks, and nutrition products. This diversification is its core strategy, which has allowed the company to maintain a steady revenue stream over the last several decades. Moreover, the company’s global presence makes it well-positioned to capitalize on opportunities in emerging markets. The Latin American market provides ample opportunity to drive long-term cash flow generation and earnings.
Despite headwinds in 2023, PepsiCo delivered solid revenue growth, including a record free cash flow of $9.07 billion. In June 2024, it also raised its quarterly dividend by 7% to a record $1.355 per share. Management remains extremely confident in its ability to deliver 4% revenue growth and 8% earnings per share growth in FY24. As business conditions continue to improve in 2024, PEP stock is undoubtedly one of the top dividend kings to buy before Wall Street takes notice.
Coca-Cola (KO)
Coca-Cola (NYSE:KO), one of the most recognizable brands in the world, has a history of more than 130 years. The company’s extensive distribution network, marketing prowess, and brand loyalty have allowed it to maintain its dominant position in the beverage industry.
Coca-Cola’s long streak of dividend increases spans an astonishing 62 years. This means that during the boom and bust cycles of the market, it still managed to increase its dividend and return capital to shareholders. It speaks volumes to the company’s robust business model, stable cash flows, and strong brand loyalty. Coca-Cola’s strategy is similar to PepsiCo’s, where diversification in its portfolio remains a key pillar to its stability. It stays ahead of industry trends, and happily embraces healthier food and beverage options that are in demand from consumers. More specifically, beverages that have a low profile of sugar or zero sugar content.
Furthermore, its growing revenue and strong margin expansion capabilities are also another positive sign for the future. If you’re looking for dividend kings to buy in June, KO stock is a noteworthy candidate worth considering.
On the date of publication, Terel Miles did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
