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Dividend stocks in development can build long-term wealth due to the cumulative effect and value appreciation. As the weather begins to warm up, savvy investors are starting to think about some of those big names that benefit from spring temperatures.
Three stocks in particular stand out: all of them are market leaders and offer strong prospects for long-term expansion.
Consider investing in those dividend-boosting stocks now, as the global situation heats up.
It competes in all segments of the soft drink market with dozens of brands such as Coca-Cola, Diet Coke, Sprite, Fanta, Dasani, and Costa. Its recent market share in the EE. UU. es 46. 3%, with five of the top ten best-selling soft drinks. beverages. Total profit of $45. 75 billion in 2023.
When it comes to dividend corporations, Coca-Cola is a rock star. The company is one of the oldest dividend stocks and one of only 25 dividend-paying U. S. corporations for more than a hundred years. Plus, it’s a dividend king with a 62-year streak of increases. It recently increased the dividend by an additional 5. 4% in February 2024.
The stagnation of the percentage value and the increase in the dividend allowed the dividend yield to reach around 3. 2%. The dividend usually increases between 5% and 10% each year. It is backed by an adequate payout ratio of 68%. The $9. 75 billion free money exceeds the $7. 95 billion dividend distribution. You get a B dividend quality rating, getting better dividend security.
Despite rising earnings and profits, Coca-Cola’s stock value has remained strong since about mid-2022. It trades at a value-to-earnings ratio of 21. 5 times, below the 5-year and 10-year ranges. However, consensus gains are expected to increase in 2024 and 2025.
As the weather warms, Americans swoon to grill. Hormel Foods (NYSE: HRL) is well-positioned to supply red meat and turkey products to consumers. It owns brands such as Hormel, Black Label, Jennie-O, Spam, Applegate, Sadler’s Smokehouse, and Austin Blues. The company is a market leader in many categories. Spam has more than 50% of the market in the non-perishable meat sector, while Applegate and Jennie-O are No. 3 and No. 4 in their segments.
In addition to red meat and turkey products, Hormel owns the Planters logo with a 17% market share in the nut sector, and Skippy, the second peanut butter company in terms of sales. Total profit of $12. 14 billion in the last 12 months.
Hormel is a popular dividend expansion stock. It’s a dividend king with a 58-year streak of accumulation. The company’s dividend yield reached around 3. 85% as the stock value fell. and the forward yield now stands at 3. 25%. The dividend accumulates around 5-6% year-over-year. We don’t expect this to replace due to the 68% payout rate.
Dividend protection is seamless, and inventory receives a B from Portfolio Insight for the quality of its dividends. It also has a top average A-/A1 investment credit score, offering more confidence in your protection. In addition, the $968 million loose money covers more than the $601 million dividend requirement.
Constellation Brands (NYSE: STZ) is probably less well-known than the other two companies. However, it is a giant in the spirits business, especially after obtaining Modelo’s U. S. brewing business with a perpetual license in 2013. As a result, profits, profits, and loose money have skyrocketed. Modelo Especial is now the best-selling beer in the United States. In addition to Modelo, Constellation owns or controls the selling rights to Corona, Pacifico, Kim Crawford, Meiomi, Robert Mondavi, The Prisoner and SVEDKA. Today, Constellation has a market capitalization of approximately $50 billion, and its profits have reached $9. 82 billion.
Constellation only started paying dividends in 2015 and increased them for nine years, which landed it on the Dividend Challenger list. The future dividend yield is 1. 3% and the dividend increases by approximately 5% year-over-year. However, the security of dividends is exceptional, with a payout ratio of 33% and a flexible money policy of 41%. The stock also has a B dividend quality rating, which means it is in the 80th percentile. We expect many more dividend increases due to maximum dividend security.
The stock trades at a P/E ratio of around 20 times, in its decade-long range. So, it’s not extremely undervalued, but investors deserve this stock because of its market leadership and dividend growth prospects.
At press time, Prakash Kolli held a LONG position in KO and HRL. The views expressed in this article are those of the author and are subject to InvestorPlace. com’s publication guidelines.
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