Are you looking for attractive dividend stocks right now? Then you'll want to do a deep dive on PepsiCo (PEP 0.85%), Realty Income (O +0.35%), and Enterprise Products Partners (EPD 1.61%). And if you already own them, you might even want to double up on your commitment. Here's why.
1. PepsiCo covers a lot of ground
PepsiCo is best known as a soda maker, but that's just the start. It is one of the world's largest beverage companies, the largest maker of salty snacks, and has a large packaged-food business. You know the brands, from its namesake to Frito-Lay and Quaker Oats. And those are just the big ones; there are a lot of industry-leading brands beyond those three labels. PepsiCo is really a very well-diversified food company.
NASDAQ: PEP
Key Data Points
The stock isn't doing very well right now because the business' financial results have been a bit weak of late. It provided fairly muted guidance for 2025 when it reported full-year 2024 earnings.
But every company goes through hard times at some point. PepsiCo has proved that it can survive them and thrive over the long term. The best evidence of that is its status as a Dividend King, having rewarded investors with over five decades' worth of annual dividend increases. That's a record that doesn't happen by accident; it requires a strong business plan that is well executed year in and year out -- even during the hard times.
That said, this is one of those hard times, with the stock down more than 20% from its 52-week high. The 3.6% dividend yield is near the highest levels in the company's recent history. Even higher than the yield during the Great Recession! If you think in terms of decades, now is the time to buy this industry-leading consumer staples giant.
2. Realty Income is a high-yield tortoise
Realty Income's streak of annual dividend increases is up to 30 years and counting, and it offers a huge 5.8% yield. That's notably higher than the 3.8% yield of the average among its fellow real estate investment trusts (REITs). Rising interest rates have put downward pressure on the share price, which is reasonable. Higher rates make it more difficult to ink profitable real estate deals.
That said, property markets have always adjusted to higher rates, and Realty Income has advantaged access to capital markets thanks to its size and financial strength. So this, too, shall pass. And while times are tougher today, the REIT is well positioned to deal with the headwinds.
NYSE: O
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Realty Income is the largest net lease REIT, with a portfolio of more than 15,400 properties. It is focused on retail assets, but also invests in industrial properties and other, more diversified buildings, like casinos and data centers.
Its portfolio extends geographically across North America and Europe, making it one of the most diversified REITs you can buy. And its investment-grade balance sheet makes it one of the financially strongest ones you can buy, too.
Realty Income isn't going to excite you given its size -- slow and steady is what you should expect. But slow and steady with a 5.8% dividend yield will likely be very attractive to most long-term dividend investors.
3. Enterprise Products Partners operates in the most reliable energy niche
Enterprise Products Partners has the highest yield of this trio, at 6.4% (the average energy stock pays out just 3.3%). This investment-grade master limited partnership (MLP) has increased its distribution every year for 26 consecutive years.
That's impressive given the inherent volatility of the energy sector. But it isn't shocking because Enterprise operates a toll taker business, charging fees for the use of its vital infrastructure assets. Energy prices are less important than demand for energy.
NYSE: EPD
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That said, investors might be worried that Enterprise is focused on serving the carbon fuel economy. That concern is not unrealistic given the ongoing growth of cleaner energy sources. However, demand for carbon fuels is likely to remain strong for decades thanks to growing energy demand. Essentially, an all-of-the-above strategy is likely to be needed to sate the world's massive appetite for power.
Investors shouldn't expect massive growth from Enterprise, but given the huge yield, that probably won't bother investors trying to maximize the income they generate from their portfolios.
Buy them or add to them, either way you'll likely win
If you don't already own PepsiCo, Realty Income, and Enterprise Products Partners, they all look like attractive long-term dividend stocks. If you do own them, meanwhile, they are priced attractively enough for you to consider adding to your positions. Either way, if you think in decades and not days, this trio of high-yield stocks is well worth your consideration right now.
