Certainly, investors should laud PepsiCo (PEP -0.50%) for paying a quarterly dividend since 1965 and raising the payment annually for the last 48 years. At the current share price and an annual $4.09 payment, the dividend yield is 3%.

But, as impressive as PepsiCo is, other stocks have a higher yield. Of course, it is important to ensure that a company can sustain its dividend, and these companies certainly qualify.

Here's a closer look at three stocks with higher yields than PepsiCo that deserve your consideration.

Five piles of gold coins that increase in size with Yield spelled out on top

Image source: Getty Images.

1. Coca-Cola

Coca-Cola (KO -0.46%), the world's largest nonalcoholic beverage company, is a direct PepsiCo competitor. It has strong brands like Coca-Cola, Diet Coke, Fanta, and Sprite, and it has shown it can change to shifting consumer tastes with offerings beyond soft drinks, including water, juice, and plant-based beverages.

The company's business has been consistently strong for a long time. In fact, it is a Dividend King, an S&P 500 company that has raised its dividend for at least 50 straight years. Most recently, Coca-Cola hiked April's quarterly payment from $0.40 to $0.41, bringing its streak to a remarkable 58 years. With the stock price at the current level, its yield is 3.4%.

Even though its first-half results were negatively affected by COVID-19 and the ensuing governmental orders to close places such as restaurants, Coca-Cola's free cash easily covered its dividend. During the period, it produced operating cash flow of $2.8 billion, 38% below a year ago. After capital expenditures of $536 million, its free cash flow was $2.3 billion. Even in a difficult environment, the company was easily able to pay the $1.8 billion of dividends.

2. Walgreens Boot Alliance

Walgreens Boot Alliance (WBA -0.87%) is a pharmacy retailer with well-known brands such as Walgreens and Duane Reade under its umbrella. Of course, people always need their prescription drugs and the other merchandise these stores sell, such as beauty products and toiletries.

Despite the challenges presented by COVID-19, Walgreens' fiscal third-quarter sales (ended May 31) were $34.6 billion, flat versus the prior year. The pandemic hurt its international operations after the U.K. government imposed strict stay-at-home orders, with management estimating this dented its quarterly sales by $700 million to $750 million.

In July, the company announced it raised the quarterly dividend from $0.4575 to $0.4675, and the stock currently yields 4.6%. What greater sign of confidence could it provide, particularly amid a recession and pandemic?

The recent increase marked 45 consecutive years with a raise. This makes it a Dividend Aristocrat.

Looking at its cash-generating ability, there is a nice cushion. For the first nine months of the year, Walgreens' free cash flow was $2.4 billion and its dividends were $1.3 billion.

3. J.M. Smucker

J.M. Smucker (SJM -0.41%) sells food, coffee, and pet foods under well-recognized brands like Jif, Smucker's, Uncrustables, Folgers, Meow Mix, and Milk-Bone.

The company's fiscal fourth-quarter (ended April 30) results benefited from the pandemic causing people to stay home. More people craved its products and rushed out to buy them. For the year, its adjusted sales, which excludes the effects of acquisitions, divestitures, and foreign currency translations, grew 1% to $7.8 billion.

In a recession, people will likely eat at home more. And, just as they did during the pandemic, consumers will likely turn to J.M. Smucker's products.

In 2020, the company produced $985 million of free cash flow and dividend payments were $396.8 million.

With strong cash flow and stable demand for its products, it's no wonder that the company announced last month that the board of directors raised the quarterly dividend from $0.88 to $0.90. This works out to a 3.2% yield. While J.M. Smucker is not a Dividend Aristocrat yet, this was the 19th consecutive year that the company has deemed it appropriate to raise its payment.