Two Dividend Kings to Buy for 2026
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 5 hours ago
0mins
Should l Buy PEP?
Source: Yahoo Finance
- PepsiCo's Transformation: In response to the impact of weight-loss drugs on the food and beverage sector, PepsiCo has adjusted its strategy by enhancing nutritional quality and reducing portion sizes, recently reporting an 8.5% net revenue growth, which supports its 54-year dividend growth record.
- Housing Market Challenges: Existing-home sales in the U.S. have plummeted due to rising mortgage rates, causing Lowe's revenue to drop over 10% from its highs; however, comparable-store sales have shown recovery in the last three quarters, indicating signs of market normalization.
- Dividend Yield Comparison: PepsiCo currently offers a dividend yield of 3.6%, while Lowe's stands at 1.95%; despite Lowe's lower starting yield, its stock repurchase strategy has reduced shares outstanding by 37%, providing potential for capital returns to investors.
- Future Outlook: As the housing market normalizes, demand for Lowe's is expected to receive strong support, while PepsiCo aims to drive long-term profits through steady price increases, making both stocks solid passive income choices for 2026.
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Analyst Views on PEP
Wall Street analysts forecast PEP stock price to rise
12 Analyst Rating
6 Buy
6 Hold
0 Sell
Moderate Buy
Current: 158.380
Low
144.00
Averages
161.90
High
172.00
Current: 158.380
Low
144.00
Averages
161.90
High
172.00
About PEP
PepsiCo, Inc. is a global beverage and convenient food company. The Company’s segments include PepsiCo Foods North America (PFNA), PepsiCo Beverages North America (PBNA), International Beverages Franchise (IB Franchise), Europe, Middle East and Africa (EMEA), Latin America Foods (LatAm Foods), and Asia Pacific Foods. PFNA segment includes all of its convenient food businesses in the United States and Canada. PBNA segment includes all of its beverage businesses in the United States and Canada. IB Franchise segment includes its international franchise beverage businesses, as well as its SodaStream business. EMEA segment includes its convenient food businesses and beverage businesses with Company-owned bottlers in Europe, the Middle East and Africa. LatAm Foods segment includes all of its convenient food businesses in Latin America. Asia Pacific Foods segment consists of its convenient food businesses in Asia Pacific, including China, Australia and New Zealand, as well as India.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
PepsiCo Exceeds Expectations with Strong 2026 Performance
- Significant Earnings Growth: PepsiCo achieved a 27% year-over-year EPS growth in 2026, driven by operational efficiencies that further solidified its competitive position in the market.
- Dividend Stability: As a 'Dividend King', PepsiCo has increased its dividend for over 50 consecutive years, currently yielding 3.7%, with a forecast of $7.9 billion in dividends for the current fiscal year, demonstrating its commitment to shareholders.
- Strong Market Performance: PepsiCo's stock has outperformed the S&P 500 in 2026, reflecting its resilience and appeal during economic volatility, attracting more conservative investors.
- Success of Simple Business: By focusing on simple yet exceptional business practices, PepsiCo has shown greater resilience in uncertain market conditions, proving that sometimes 'boring' can be more advantageous.
See More
Dividend Investors' Safe Strategies Amid Market Challenges
- REIT Performance: Realty Income owns approximately 15,500 single-tenant net-leased properties, with nearly 99% leased, ensuring a steady revenue stream, and has paid monthly dividends since 1994, with an annual payout of about $3.25 per share, yielding 5%, significantly above the S&P 500's 1.1% average.
- Coca-Cola's Transformation: PepsiCo, known as a 'Dividend King' for raising dividends for 54 consecutive years, currently pays a dividend of $5.69 per share with a yield of about 3.6%, and despite health-conscious trends, net revenue grew by 2% in 2025 and nearly 9% in Q1 2026, demonstrating resilience in adversity.
- Brand Integration Challenges: J.M. Smucker, with its portfolio of well-known brands, faces integration challenges from the Hostess Cakes acquisition, with sales not meeting expectations; however, its dividend has increased for 24 straight years, currently at $4.40 per share with a yield of 4.7%, and free cash flow easily covered $348 million in dividend costs for the first three quarters.
- Market Volatility Impact: Although J.M. Smucker's stock has declined over 40% since 2023, its P/E ratio has fallen to 22, still providing a solid investment opportunity for income-seeking investors, indicating the company's strong capability to maintain high-yield dividends.
See More
Realty Income Maintains Steady Dividend Growth
- Consistent Dividend History: Realty Income has paid monthly dividends since 1994, with an annual payout of nearly $3.25 per share and a yield of 5%, significantly above the S&P 500's 1.1%, demonstrating its stability and attractiveness in uncertain markets.
- Strong Cash Flow Support: The company generates $4.25 per share in funds from operations, covering dividend expenses and maintaining a price-to-earnings ratio of 15, indicating that investors can purchase a high-yield stock at a relatively low price, enhancing its appeal.
- Sustainable Growth Potential: Despite market challenges, PepsiCo maintains a 54-year dividend growth streak, with a current payout of $5.69 per share yielding 3.6%, showcasing its resilience underpinned by a diversified product portfolio and stable cash flow.
- Attractive Discount Pricing: J.M. Smucker offers a $4.40 per share dividend with a yield of 4.7%, and despite facing sales pressures, its $672 million in free cash flow easily covers $348 million in dividend expenses, indicating its ongoing capacity for high-yield dividends.
See More
Investment Opportunities in PepsiCo and Lowe's Amid Market Trends
- PepsiCo's Growth Strategy: Despite challenges in the food and beverage sector due to the rise of weight-loss drugs, PepsiCo has successfully achieved an 8.5% net revenue growth by improving nutritional quality and reducing portion sizes, demonstrating its adaptability in adverse market conditions.
- Stable Dividend Yield: PepsiCo has raised its dividend for 54 consecutive years, currently offering a 3.6% yield, which positions it as a reliable source of passive income for investors over the next 50 years, reflecting its strong profitability and market position.
- Lowe's Market Recovery: Although the U.S. housing market is sluggish, Lowe's comparable-store sales have turned positive in the last three quarters, indicating revenue growth from existing locations and showcasing its resilience in tough times.
- Future Growth Potential: As the housing market normalizes, Lowe's demand is expected to see significant growth; despite a current dividend yield of 1.89%, management focuses more on stock buybacks, having reduced shares outstanding by 37% over the past decade, providing a solid capital return outlook for investors.
See More
Investment Opportunities in Dividend Kings
- Dividend Kings: Both PepsiCo and Lowe's are Dividend Kings, having increased their dividends for 50 consecutive years, with current yields of 3.6% and 1.95% respectively, providing a stable source of passive income during market downturns.
- Market Challenges: PepsiCo faces stagnation in sales growth due to the popularity of weight-loss drugs; however, it reported an 8.5% net revenue growth in Q1 2023, indicating a successful pivot through improved nutritional quality and pricing strategies.
- Housing Market Impact: Lowe's revenue has declined over 10% from its peak, yet comparable-store sales growth has turned positive in the last three quarters, demonstrating the company's ability to grow revenue despite a sluggish housing market.
- Future Outlook: As the housing market normalizes, Lowe's is expected to benefit from a resurgence in home renovation demand, with management focusing on stock buybacks, reducing shares outstanding by 37% over the past decade, which should enhance shareholder returns.
See More
Two Dividend Kings to Buy for 2026
- PepsiCo's Transformation: In response to the impact of weight-loss drugs on the food and beverage sector, PepsiCo has adjusted its strategy by enhancing nutritional quality and reducing portion sizes, recently reporting an 8.5% net revenue growth, which supports its 54-year dividend growth record.
- Housing Market Challenges: Existing-home sales in the U.S. have plummeted due to rising mortgage rates, causing Lowe's revenue to drop over 10% from its highs; however, comparable-store sales have shown recovery in the last three quarters, indicating signs of market normalization.
- Dividend Yield Comparison: PepsiCo currently offers a dividend yield of 3.6%, while Lowe's stands at 1.95%; despite Lowe's lower starting yield, its stock repurchase strategy has reduced shares outstanding by 37%, providing potential for capital returns to investors.
- Future Outlook: As the housing market normalizes, demand for Lowe's is expected to receive strong support, while PepsiCo aims to drive long-term profits through steady price increases, making both stocks solid passive income choices for 2026.
See More
PepsiCo Exceeds Expectations with Strong 2026 Performance
- Significant Earnings Growth: PepsiCo achieved a 27% year-over-year EPS growth in 2026, driven by operational efficiencies that further solidified its competitive position in the market.
- Dividend Stability: As a 'Dividend King', PepsiCo has increased its dividend for over 50 consecutive years, currently yielding 3.7%, with a forecast of $7.9 billion in dividends for the current fiscal year, demonstrating its commitment to shareholders.
- Strong Market Performance: PepsiCo's stock has outperformed the S&P 500 in 2026, reflecting its resilience and appeal during economic volatility, attracting more conservative investors.
- Success of Simple Business: By focusing on simple yet exceptional business practices, PepsiCo has shown greater resilience in uncertain market conditions, proving that sometimes 'boring' can be more advantageous.
See More
Dividend Investors' Safe Strategies Amid Market Challenges
- REIT Performance: Realty Income owns approximately 15,500 single-tenant net-leased properties, with nearly 99% leased, ensuring a steady revenue stream, and has paid monthly dividends since 1994, with an annual payout of about $3.25 per share, yielding 5%, significantly above the S&P 500's 1.1% average.
- Coca-Cola's Transformation: PepsiCo, known as a 'Dividend King' for raising dividends for 54 consecutive years, currently pays a dividend of $5.69 per share with a yield of about 3.6%, and despite health-conscious trends, net revenue grew by 2% in 2025 and nearly 9% in Q1 2026, demonstrating resilience in adversity.
- Brand Integration Challenges: J.M. Smucker, with its portfolio of well-known brands, faces integration challenges from the Hostess Cakes acquisition, with sales not meeting expectations; however, its dividend has increased for 24 straight years, currently at $4.40 per share with a yield of 4.7%, and free cash flow easily covered $348 million in dividend costs for the first three quarters.
- Market Volatility Impact: Although J.M. Smucker's stock has declined over 40% since 2023, its P/E ratio has fallen to 22, still providing a solid investment opportunity for income-seeking investors, indicating the company's strong capability to maintain high-yield dividends.
See More
Realty Income Maintains Steady Dividend Growth
- Consistent Dividend History: Realty Income has paid monthly dividends since 1994, with an annual payout of nearly $3.25 per share and a yield of 5%, significantly above the S&P 500's 1.1%, demonstrating its stability and attractiveness in uncertain markets.
- Strong Cash Flow Support: The company generates $4.25 per share in funds from operations, covering dividend expenses and maintaining a price-to-earnings ratio of 15, indicating that investors can purchase a high-yield stock at a relatively low price, enhancing its appeal.
- Sustainable Growth Potential: Despite market challenges, PepsiCo maintains a 54-year dividend growth streak, with a current payout of $5.69 per share yielding 3.6%, showcasing its resilience underpinned by a diversified product portfolio and stable cash flow.
- Attractive Discount Pricing: J.M. Smucker offers a $4.40 per share dividend with a yield of 4.7%, and despite facing sales pressures, its $672 million in free cash flow easily covers $348 million in dividend expenses, indicating its ongoing capacity for high-yield dividends.
See More
Investment Opportunities in PepsiCo and Lowe's Amid Market Trends
- PepsiCo's Growth Strategy: Despite challenges in the food and beverage sector due to the rise of weight-loss drugs, PepsiCo has successfully achieved an 8.5% net revenue growth by improving nutritional quality and reducing portion sizes, demonstrating its adaptability in adverse market conditions.
- Stable Dividend Yield: PepsiCo has raised its dividend for 54 consecutive years, currently offering a 3.6% yield, which positions it as a reliable source of passive income for investors over the next 50 years, reflecting its strong profitability and market position.
- Lowe's Market Recovery: Although the U.S. housing market is sluggish, Lowe's comparable-store sales have turned positive in the last three quarters, indicating revenue growth from existing locations and showcasing its resilience in tough times.
- Future Growth Potential: As the housing market normalizes, Lowe's demand is expected to see significant growth; despite a current dividend yield of 1.89%, management focuses more on stock buybacks, having reduced shares outstanding by 37% over the past decade, providing a solid capital return outlook for investors.
See More
Investment Opportunities in Dividend Kings
- Dividend Kings: Both PepsiCo and Lowe's are Dividend Kings, having increased their dividends for 50 consecutive years, with current yields of 3.6% and 1.95% respectively, providing a stable source of passive income during market downturns.
- Market Challenges: PepsiCo faces stagnation in sales growth due to the popularity of weight-loss drugs; however, it reported an 8.5% net revenue growth in Q1 2023, indicating a successful pivot through improved nutritional quality and pricing strategies.
- Housing Market Impact: Lowe's revenue has declined over 10% from its peak, yet comparable-store sales growth has turned positive in the last three quarters, demonstrating the company's ability to grow revenue despite a sluggish housing market.
- Future Outlook: As the housing market normalizes, Lowe's is expected to benefit from a resurgence in home renovation demand, with management focusing on stock buybacks, reducing shares outstanding by 37% over the past decade, which should enhance shareholder returns.
See More
Two Dividend Kings to Buy for 2026
- PepsiCo's Transformation: In response to the impact of weight-loss drugs on the food and beverage sector, PepsiCo has adjusted its strategy by enhancing nutritional quality and reducing portion sizes, recently reporting an 8.5% net revenue growth, which supports its 54-year dividend growth record.
- Housing Market Challenges: Existing-home sales in the U.S. have plummeted due to rising mortgage rates, causing Lowe's revenue to drop over 10% from its highs; however, comparable-store sales have shown recovery in the last three quarters, indicating signs of market normalization.
- Dividend Yield Comparison: PepsiCo currently offers a dividend yield of 3.6%, while Lowe's stands at 1.95%; despite Lowe's lower starting yield, its stock repurchase strategy has reduced shares outstanding by 37%, providing potential for capital returns to investors.
- Future Outlook: As the housing market normalizes, demand for Lowe's is expected to receive strong support, while PepsiCo aims to drive long-term profits through steady price increases, making both stocks solid passive income choices for 2026.
See More
