I'd Put $500 Into Each of These 5 Dividend Stocks and Throw Away the Statement
Axe Cap view
Five Steadfast Dividend Stocks Worth Owning Through Volatility
High-quality dividend payers with long track records can offer steadiness when markets are choppy.
The market's recent jitters over inflation and higher interest rates have plenty of investors second-guessing their dividend stocks. Yet some companies, like PepsiCo and Hormel, have proven for decades they can raise payouts through thick and thin. These staple-makers sell essentials people buy regardless of the economy, and their long dividend histories—50+ years running for some—are not by chance. Similarly, Realty Income’s vast real estate footprint and investment-grade balance sheet give it resilience despite rate hikes. The core lesson here is patience: the headwinds are real, but undervaluing these businesses' fundamentals can mean missing steady compounding over time. South African investors should watch USD/ZAR closely as rand weakness can boost imported inflation, testing consumer demand here. For a local tilt, Capitec and Shoprite might be worth comparing as domestic proxies, though the global firms on this list provide a clean dividend growth story less disturbed by local issues. The case isn’t bulletproof—should inflation spiral higher or consumer behavior shift dramatically, even these stalwarts could face pressure. this is just our opinion and not financial advice
Buy shares in firms with strong dividend track records like PepsiCo and Realty Income for steady income and growth. Keep an eye on USD/ZAR as rand volatility could impact local consumer stocks like Capitec and Shoprite. Avoid chasing yield in riskier sectors.
- PEP
- O
- USD/ZAR
- Capitec
- Shoprite
- Inflation proving more persistent and hurting consumer spending
- Sharp appreciation of USD against ZAR increasing cost inflation locally
6/10
The author recommends five dividend stocks currently out of favor: PepsiCo, Hormel, Hershey, McCormick, and Realty Income. Despite near-term headwinds from inflation and rising interest rates, the author believes these companies have strong fundamentals, long histories of dividend increases, and will navigate current challenges successfully. He advocates a long-term buy-and-hold approach with dividend reinvestment, ignoring short-term stock price fluctuations.
Our take is based on reporting first published by The Motley Fool.