The Motley Foolยท2025-10-22 00:24Core Viewpoint - Dividend stocks, particularly Coca-Cola and Chevron, are highlighted as strong foundational holdings due to their durable and steadily rising dividends, which historically outperform non-payers with less volatility [1]. Coca-Cola - Coca-Cola has increased its dividend for 63 consecutive years, placing it among the Dividend Kings with a current yield of 3%, significantly higher than the S&P 500's 1.2% [2][5]. - The company expects to generate approximately $11.7 billion in cash flow from operations this year, sufficient to cover capital expenditures and dividend payments, while also allowing for share repurchases [3]. - Coca-Cola aims for 4% to 6% annual organic revenue growth and 7% to 9% annual earnings-per-share growth, supporting its ability to continue raising dividends [5]. - Strategic acquisitions since 2016 have contributed to a quarter of Coca-Cola's earnings growth, enhancing its capacity to grow dividends further [6]. Chevron - Chevron has a 38-year streak of increasing dividends, the second-longest in the oil sector, demonstrating impressive consistency despite sector volatility [7]. - The company has an integrated business model that includes upstream, midstream, and downstream operations, providing a natural hedge against commodity price fluctuations [9]. - Chevron maintains a strong balance sheet with a net debt ratio below 15%, allowing flexibility to fund growth projects and shareholder returns during downturns [10]. - Recent growth capital projects and the acquisition of Hess are expected to add up to $12.5 billion to Chevron's free cash flow next year, supporting ongoing dividend growth [11]. Conclusion - Both Coca-Cola and Chevron are recognized as reliable dividend stocks with resilient cash flows and strong balance sheets, positioning them well for long-term growth and dividend sustainability [12].