Consumer Staples Companies on Sale: 3 Iconic Brands to Consider

The consumer staples sector is often seen as a reliable source of dividend income, with companies providing basic necessities that get purchased regularly regardless of the economic or market environment. Among these iconic brands are General Mills, Clorox, and PepsiCo, all of which offer historically attractive yields today.

General Mills: A Time-Tested Dividend King

General Mills is one of the largest packaged food makers on the planet, with a strong brand portfolio that includes Cheerios, Betty Crocker, and Pillsbury. Despite facing headwinds in its business, investors have been shunning the stock, pushing its dividend yield up to a historically high 4.8%. However, General Mills has a long history of adjusting to shifting consumer trends and buying habits, and it's likely that the company will find a way to get back on the growth track.

In fact, General Mills has managed to pay a dividend for an impressive 124 years, with the dividend trending generally higher for decades. Unless you believe that people are going to suddenly stop eating, it's unlikely that General Mills will experience a prolonged decline in sales or earnings. The company's strong brand portfolio, innovation track record, and top-notch distribution and marketing strength make it well-equipped to navigate changing consumer preferences.

Clorox: A Proven Survivor with a High Yield

Clorox is another iconic consumer staples company that has increased its dividend annually for 48 consecutive years, just two shy of Dividend King status. The company's dividend yield is historically high at around 3.8%, making it an attractive option for investors looking to build their wealth through reliable dividend stocks.

One of the big challenges facing Clorox has been the fact that its margins got crushed after the coronavirus pandemic. However, management has been working hard to fix this headwind and achieving material success. The company's gross margin has improved by around 10 percentage points from the low it saw in 2022, thanks to cost cutting, streamlining, and innovation.

PepsiCo: A Dividend King with a High Yield

PepsiCo is another food maker with a heavy focus on beverages (Pepsi) and salty snacks (Frito-Lay). The company also makes packaged foods in its Quaker Oats business, but that's a smaller operation. Right now, the company is facing headwinds and its growth has been lagging that of its peers, including Coca-Cola. However, PepsiCo is an industry leading company with a strong competitive position.

The company has a proven track record of innovation, business optimization, and buying new brands to refresh its brand portfolio. These aren't exactly exciting things, but they're just business as usual for PepsiCo. The company has been a Dividend King for over five decades, with annual dividend increases behind it.

Getting Past Recent Performance

The hard part with General Mills, Clorox, and PepsiCo is getting past each company's less-than-impressive recent business performance. To do that, simply focus on how well these companies have been run over the long term. Then you can easily justify buying these historically high-yielding stocks.

Once you've made your purchase, sit back and collect big dividend checks while you wait for better days. History suggests that, given time, each of these iconic consumer staples makers will reward you well.

Conclusion

The consumer staples sector is often seen as a reliable source of dividend income, with companies providing basic necessities that get purchased regularly regardless of the economic or market environment. Among these iconic brands are General Mills, Clorox, and PepsiCo, all of which offer historically attractive yields today.

Each of these companies has a long history of success and a proven track record of adapting to changing consumer preferences. While they may be facing headwinds in their business right now, it's unlikely that these companies will experience a prolonged decline in sales or earnings.

By focusing on the long-term performance of these companies and ignoring their recent struggles, investors can easily justify buying these historically high-yielding stocks. And once you've made your purchase, sit back and collect big dividend checks while you wait for better days.

In conclusion, General Mills, Clorox, and PepsiCo are all attractive options for investors looking to build their wealth through reliable dividend stocks. Their long history of success, proven track record of adapting to changing consumer preferences, and historically high yields make them well-equipped to navigate the ups and downs of the market.

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