3 Highest Yielding Dividend Kings Ready to Soar

Flashy tech stocks usually make the headlines when they are going up or down and often leads retail investors to bet on notoriously volatile stocks out of hype or FOMO. At the same time, the smart money sits quietly while their dividends compound.  

Unlike the new, high-tech, high-growth companies, Dividend Kings are more stable and well-established leaders who have raised their dividends for 50+ consecutive years.

That said, not all Dividend Kings are worth buying, as any dividend-paying company can increase its payout by as little as $0.0025 annually and get the fancy title. As such, I carefully selected 3 Dividend Kings worth considering for your portfolio. 

How I Came Up With The Following Stocks

I used Barchart’s Stock Screener tool along with the following filters: 

• Dividend Kings Watchlist: I have a handful of Barchart watchlists. I purposely created them to quickly focus on specific industries or certain types of stocks, like Dividend Kings' stocks.
• Dividend Yield: I left this blank to see the results' lowest to highest dividend yields.
• Current Analyst Rating: A score of 3.5 to 5 (Moderate to Strong Buy)
• Number of Analysts: 12 or more. 

This combination allows me to look for buy-rated stocks covered by Wall Street analysts, while avoiding “perfect” 5-rated companies that only have one or two analysts covering them.

After setting the filters, I was left with 22 companies:

Then, I sorted the list from highest to lowest annual dividend yield to get a list of the top 3 Highest Yielding Dividend Kings to Buy Today: Target Corp (TGT), Stanley Black & Decker Inc (SWK), and Pepsico Inc. (PEP). 

Target Corp (TGT)

Target operates nearly 2,000 retail stores and an e-commerce platform selling affordable items such as apparel, beauty products, groceries, electronics, home furnishings, and more. Its larger stores include complete grocery sections, while digital channels offer both in-store and exclusive items from Target and, in some cases, third-party vendors. 

Recently, the retail giant announced plans to accelerate growth by investing in trendy merchandise, shopping experiences, and better supply chains to increase sales by 2030. The plan also includes expanding the Target Plus marketplace to $5 billion and improving the Target Circle loyalty program.

Target's Q4'24 financials reported revenue decreased by 3.14% year-over-year to $30.9 billion, with profits declining 20.19% to $1.1 billion. Consequently, the company’s quarterly EPS dropped to $2.41 from $2.98.

That said, Target’s dividend is impressive - it recently paid its 231st dividend (currently $4.48 annually.) Not only that, but the company has a healthy payout ratio of 49.92% and a forward yield of 4.3%, which exceeds many alternatives in the sector.

Wall Street consensus on TGT stock is a “Moderate Buy” with a score of 3.85 out of 5 from 33 analysts, which suggests optimism about Target’s prospects. A high price target of $188 on TGT also reflects an ~80% upside potential from the stock's current levels. 

Stanley Black & Decker Inc (SWK)

It would be difficult to find a home without something made by Stanley Black & Decker. The company makes hand tools, power tools, outdoor equipment, fastening solutions, and a whole lot more. Its business has two main segments: Tools & Outdoor (for pros and consumers) and Industrial (for fastening components).

Stanley's Q4'24 financials pointed to strength. Its top line was $3.72 billion for the quarter, though sales decreased by 0.43% year-over-year. The company's bottom line bounced to $194.9 million from a $304 million loss, making its EPS $1.28—compared with a $2.03 loss for the same year-ago quarter. Considering all the macroeconomic headwinds, I'd say that's a pretty solid recovery.

This Dividend King offers a forward dividend of $3.28, which translates to an attractive forward yield of 4.05%. More notably, Stanley Black & Decker has increased dividends for 57 straight years, which is very rare!

Wall Street rates SWK stock a moderate buy (3.5 out of 5) based on a consensus of 16 analysts. Moreover, its highest price target of $120 reflects a potential ~48% upside for investors joining SWK's recovery phase. 

Pepsico Inc. (PEP)

PepsiCo is a giant with a portfolio of popular brands. The company produces well-known drinks like Pepsi-Cola, Mountain Dew, Gatorade, etc., alongside snack brands including Lay's and Cheetos. PepsiCo also owns Quaker Foods.

In January, PepsiCo acquired Siete Foods - a Mexican-American food company - for $1.2 billion. The acquisition added grain-free tortillas, chips, sauce, and other items in over 40,000 retailers to the company’s better-for-you portfolio. It didn’t stop there. Just recently, PepsiCo announced plans to acquire Poppi - a prebiotic soda company - for $1.95 billion with potential additional earnout consideration.

PepsiCo's Q4'24 financials reported mixed results. Sales decreased by 0.24% year-over-year to $27.8 billion, while its bottom line surged impressively by 15.86% to $1.5 billion, cementing its quarterly EPS at $1.11 (up from $0.94 in the same quarter last year).

The company’s dividend profile is also impressive. PepsiCo offers a forward annual dividend of $5.42, translating to a competitive forward yield of 3.67%. Moreover, PepsiCo has increased its dividends for 52 consecutive years.

Like the other Dividend Kings on this list, Wall Street consensus is positive on PepsiCo. Based on 20 analysts, PEP stock has a “Moderate Buy” rating (3.8 out of 5), and its high target price of $185 reflects an upside potential of 22.24%. I call that confidence in the company’s growth prospects.

Final Thoughts

In my book, these three Dividend Kings can be reliable sources of income due to their consistent and substantial payout. But, of course, nothing's guaranteed. Always do your due diligence and stop on top of the market.