Dividend stocks are an excellent way to weather stock market volatility. They enable investors to earn consistent income, which helps protect their portfolio from the market's ups and downs. Among the most impressive are Dividend Kings -- S&P 500 companies that have increased their dividends for at least 50 consecutive years, demonstrating the stability of their operations.
The good news is that investing in these stocks does not require a large sum of money. Here are two Dividend Kings that you can invest in for less than $100.
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Coca-Cola
Coca-Cola (KO) has kept its business humming for decades, which has enabled it to pay and raise dividends consistently over the last 61 years. Rising costs have been pressuring consumer companies, but Coca-Cola continues to dominate the beverage market and has steadily grown its revenue and profits over the last five years.
It usually passes on rising raw material costs to customers, who have been willing to pay. Consumer loyalty has allowed it to maintain this pricing power and generate consistent profits. Coke has also been working to diversify its product line by expanding to coffee, energy drinks, still water, and alcohol.
KO Revenue (Annual) data by YCharts
Even this year, it had to raise its prices by double digits in the second quarter. Luckily, it had no negative effect on volume, which remained flat for the quarter.
The company saw a 6% increase in net revenue in Q2 over the previous year's quarter. Net earnings increased by 11% year over year for the quarter. Talking about the results, CEO James Quincey said, "I am encouraged that our all-weather strategy, working together with our bottling partners, has delivered strong second-quarter results."
For the six months ended June 30, the company generated free cash flow of $4 billion and paid out $2 billion in dividends.
Happy with the first-half performance, Coca-Cola raised its full-year guidance. For 2023, the company expects organic revenue growth of 8% to 9% from last year. Adjusted earnings per share (EPS) also could show growth of 5% to 6% from 2022. Coca-Cola expects to generate $9.5 billion in free cash flow for the full year, allowing it to continue paying and raising dividends while also funding growth initiatives.
Currently, Coca-Cola offers a current dividend yield of 3%, higher than the S&P 500's average of 1.8%.
Hormel Foods
Packaged-food company Hormel Foods (HRL 0.14%) has increased its dividend annually for the past 57 years, assuring investors of its business stability. It offers a current dividend yield of 2.7%, higher than the market average.
Investors are concerned about short-term headwinds like inflation's effect on consumer companies. However, given Hormel's track record of success, the short-term challenges are unlikely to derail the company's long-term growth.
The company's net sales of $2.9 billion in the second quarter were down 3.8% from the previous year's quarter. Net earnings fell to $217 million from $261 million in the previous quarter.
Hormel compensates for the increase in protein prices by adjusting input costs, which include packaging, processing, and other costs. Furthermore, its brands Spam, Planters, Wholly, Jennie-O, and Dinty Moore have a loyal customer base, which has allowed it to maintain its profit margin over the last 10 years.
HRL Profit Margin (Annual) data by YCharts
Hormel's management is optimistic about dealing with short-term inflationary pressures and rebounding in the second half of the year. The company reiterated its full-year net sales growth target of 1% to 3%. Despite temporary setbacks, Hormel continues to generate profits that enable it to pay and hike dividends.
While both Coke and Hormel are growth stocks, they are also income stocks, making them an appealing choice for investors looking to buy and hold to earn stable and consistent returns.
