Ah, the sweet satisfaction of passive income. You know, the kind where your brokerage account just magically fills up with dividends while you’re sipping your morning coffee (or if you’re like me, preaching to your barista about the merits of oat milk). According to Hartford Funds, 85% of the S&P 500 returns since 1960 are thanks to the magic of reinvested dividends. So yes, those small cash deposits actually matter-turns out, all that money your stocks are paying you could be doing more than just collecting dust. It’s working overtime.
When the market decides to get moody (spoiler: it always does), having reliable dividends in your back pocket can help. So let’s dive into two consumer goods stocks that are kind of a big deal when it comes to dividend payments-making now the perfect time to either load up or jump in for the first time. Prepare to get a little richer. Or at least, less poor.
1. Coca-Cola
First up: Coca-Cola (KO), the undisputed champion of liquid refreshment and a symbol of corporate “hey, we’re in it for the long haul” vibes. With 63 consecutive years of dividend growth, Coke has earned its spot as a Dividend King (don’t worry, that’s a good thing, not the royal family’s weird uncle). The stock hit a 52-week high of $74 this year, then decided to have a modest little pullback. If you’re looking to buy, now’s your chance.
Let’s be honest: this is not just a soda company. Coke is a beverage empire-and I’m talking Sprite, Dasani, Simply, and so many other names you probably chug without a second thought. Last year, it raked in $47 billion in revenue and $12 billion in net income. That’s a lot of “yum.” And the best part? It typically hands back around 75% of its earnings in dividends. So yes, your wallet will appreciate it.
Coca-Cola’s capital-light strategy is another reason to be intrigued. Only 15% of its unit transactions involve actual bottled products. The rest? Syrup sales to bottlers. It’s like selling the ingredients to the party but not actually having to attend. With a 25% profit margin last year, this syrup-selling business is working out extremely well. What does that mean for you? A high-margin company that keeps paying out those sweet dividends no matter what the economy’s doing.
The stock’s got solid value right now, with a P/E ratio hovering around 23, and it’s dishing out a solid 3% forward dividend yield based on its quarterly payout of $0.51. It’s like they want you to have nice things. Cheers to that!
2. Constellation Brands
Next, let’s talk about Constellation Brands (STZ)-the company that makes the stuff you regret drinking on a Tuesday night and yet keep coming back to like a responsible adult. Recently, Constellation’s been the center of attention after Warren Buffett’s Berkshire Hathaway disclosed a stake in Q4 2024. Now, the stock’s down 37% this year. So, is it a bargain or just a drunken stumble in the wrong direction? If you’re a long-term investor, this dip may be your chance to jump in while it’s on sale.
Constellation controls the rights to sell some of the world’s most popular Mexican beers in the U.S.-you know, Modelo, Corona, those crispy cold refreshers that somehow taste better in a beachside bar. Last year, beer sales accounted for $8.5 billion, while wine and spirits brought in an extra $1.4 billion. This is not a company you want to sleep on, no matter how much your liver protests.
Yes, the stock’s been hurt by consumers cutting back on discretionary spending. But, look: people are always going to drink beer. You don’t need to be a market guru to see that. And when your brands have the top market share, it’s easier to weather these storms.
Despite the dip, Constellation’s forward dividend yield is looking pretty solid at almost 3%. Based on the recent $1.02 quarterly payout, the stock’s current price drop makes the yield more attractive than ever. They’re only paying out 40% of their earnings, which means there’s room to keep that dividend coming-maybe even growing. Just don’t expect any miracles right away. But they’re clearly committed to shareholders, buying back nearly 10% of shares over the last five years.
In short: if you like beer (or wine, or spirits), and you like dividends, now might be your moment to stock up. Just maybe don’t drink all the profits. That’s for the stock to do. 🍻
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2025-10-20 07:32