Core Insights - Some of the best dividend stocks, including Federal Realty Investment Trust, Johnson & Johnson, and PepsiCo, are currently experiencing significant price declines, making them attractive investment opportunities due to higher dividend yields [1][12] Federal Realty Investment Trust - Shares have declined nearly 20% from their 52-week high, resulting in a dividend yield exceeding 4.5%, which is over three times higher than the S&P 500's sub-1.5% yield [2] - The company has a record of increasing dividends for 57 consecutive years, the longest in the REIT industry, qualifying it as a Dividend King [4] - Federal Realty focuses on high-quality retail properties in major metro markets, particularly open-air shopping centers and mixed-use properties, leading to high occupancy and steady rent growth [5] Johnson & Johnson - Shares have dropped more than 8% from their recent peak, raising the dividend yield to nearly 3.5% [6] - The company has increased its dividend payment by 4.8% this year, extending its growth streak to 63 consecutive years [6] - Johnson & Johnson holds a AAA credit rating, with a strong balance sheet and robust free cash flow, generating about $20 billion annually, which comfortably covers its nearly $12 billion dividend outlay [7][8] PepsiCo - The stock has fallen over 27% from its 52-week high, resulting in a dividend yield surpassing 4% [9] - PepsiCo recently increased its dividend payout by 5%, extending its growth streak to 53 consecutive years [9] - The company invests heavily in product development and capacity expansion, expecting 4% to 6% annual organic revenue growth and high single-digit earnings-per-share growth [10][11]

Core Viewpoint - PepsiCo, a Dividend King with a history of consistent dividend growth, is currently facing challenges that have led to a decline in stock price and an increase in dividend yield to all-time highs [2][10]. Group 1: Company Performance - PepsiCo's sales exceeded $91 billion last year, but growth is slowing, with food volumes dropping 1% last year and a 3% year-over-year decline in the first quarter of 2025 [4][7]. - The company has historically leveraged its iconic brands and premium shelf space for pricing power, but inflation has significantly impacted food prices, which rose approximately 25% from 2019 to 2023 [5]. - Analysts' long-term earnings growth estimates for PepsiCo have decreased from about 8% to under 4%, contributing to the stock's decline [8]. Group 2: Financial Health - PepsiCo paid $5.42 per share in dividends last year while generating only $5.28 per share in free cash flow, indicating a potential strain on dividend sustainability [10]. - Despite this, PepsiCo maintains a strong financial position with $8.5 billion in cash and an "A+" credit rating from S&P Global, suggesting that the dividend is likely secure [10]. Group 3: Strategic Outlook - The company is adapting to market changes, including the rise of weight loss drugs, by acquiring emerging brands in health and specialty categories, which may help restart growth [12]. - There is potential for PepsiCo to divest brands that do not align with its strategic direction, indicating a proactive approach to maintaining competitiveness [12][13]. - For income-focused investors, PepsiCo remains an attractive option due to its above-average yield, despite the current challenges [13][14].

Buying a quality dividend stock near a multiyear low can be a great move, especially if you're willing to be patient and hang on for the long term. As long as the dividend remains intact, the yield moves up as a stock price falls in value. And that's been the case for all the stocks listed here.PepsiCo (PEP 0.88%), UnitedHealth Group (UNH -0.88%), and United Parcel Service (UPS 0.22%) are all down more than 15% in the past 12 months and are trading near multiyear lows. Their yields are also all firmly above ...