Down 32% With a 5.5% Yield, Is This High-Yield Dividend Stock Too Cheap to Ignore, and Worth Buying in December?

Core Viewpoint - Campbell's is positioned as a stock for income-oriented value investors, especially given its high dividend yield and current valuation despite disappointing financial results for fiscal Q1 2026 [1][2][16] Financial Performance - In the first quarter of fiscal 2026, Campbell's reported a 3% decrease in net sales and a 13% decrease in adjusted earnings per share (EPS) [10] - The company expects roughly flat organic sales growth for the full year and a 12% to 18% decline in adjusted EPS, projecting $2.40 to $2.55 in adjusted EPS [10][11] - The stock has declined 32% year-to-date, reaching its lowest level since the financial crisis of 2008 [1] Dividend Information - Campbell's dividend yield has increased to approximately 5.5%, significantly higher than the S&P 500's yield of 1.1% [2] - The company maintains an annual dividend of $1.56, resulting in a payout ratio of 63% based on the midpoint of its fiscal 2026 guidance [13] - Despite recent struggles, Campbell's has a history of maintaining or increasing its dividend since 2001, although it does not have as strong a track record as competitors like Coca-Cola and PepsiCo [14] Market Position and Strategy - Campbell's has diversified its revenue streams through its acquisition of Snyder's-Lance, focusing on four pillars: premiumization, flavor exploration, health and wellness, and cooking and comfort [5][4] - The company retains industry-leading market share across many of its brands, particularly in the meals and beverages segment, which is performing better than its discretionary snack brands [7] - CEO Mick Beekhuizen noted that consumer preferences are evolving towards health and wellness, which aligns with Campbell's offerings like V8 and low-sodium soup options [8][9] Valuation and Investment Appeal - Campbell's shares are currently trading at 11.5 times the midpoint of its full-year adjusted EPS guidance, compared to a 10-year median price-to-earnings ratio of 21.1, indicating a compelling valuation [15] - The company is well-positioned to benefit from trends in home cooking, making it an attractive option for value and income investors [16][17]