Look, the market’s been on a sugar rush lately. But not everyone’s getting invited to the party. Some stocks-S&P 500 darlings, even-are being tossed out like last week’s takeaway. Why? Because growth stocks are the new black, and dividends? Oh please. So 2019. But here’s the kicker: I’ve made a career out of buying what everyone’s throwing away. It’s the financial equivalent of picking up a $20 bill from a burning building. Or, as my therapist says, “You’re terrible at boundaries.”
Veteran investors know the drill: buy when there’s blood in the streets. But let’s be real-I’m the last person who should be giving advice. I once invested in a cryptocurrency named after a dog I hate. Still, here we are.
Three S&P 500 dividend stocks are currently being abused by the market. Let’s call them the “undesirables.” Spoiler: they’re not. But if you want to play the long game, here’s your playbook. Buckle up-it’s going to be a bumpy ride. (Also, I might cry. I’m a crier.)
1. Merck: Pharma’s Version of a Midlife Crisis
Merck (MRK) is having an identity crisis. Its entire existence hinges on Keytruda, that cancer drug everyone’s been whispering about. Half its revenue? Gone when patents expire in 2028. Gardasil sales in China? Also a dumpster fire. And yet, shares are down 39% from their peak. You’re thinking, “What a mess!” But here’s the twist: pharma’s a game of probabilities, not certainties. And Merck’s pipeline? It’s the financial equivalent of a very messy bedroom-ugly, but full of potential.
Take MK-1022. It’s for lung cancer, a market so crowded it’s like a night club on a Friday. But analysts think it could hit $5B in sales. MK-0616, their cholesterol drug? Same story. And Merck’s claiming 20 drugs in the pipeline could hit $50B by 2035. Skeptical? Of course. But at 9x earnings and a 4% yield, this isn’t a bet-it’s a mercy mission for the market’s collective anxiety.
2. Target: “Cheap Chic” in a World of “Cheap Trash”
Target (TGT) is the fashionista who can’t afford Louboutins anymore. Pre-2022, its “premium experience” was a luxury. Now? Inflation’s turned its shoppers into coupon-clipping, aisle-hopping survivalists. Plus, it got caught in the DEI crossfire. First-quarter sales dropped 3.8%. The stock’s down 60% from its peak. You’re thinking, “This is the death of retail!” But here’s the thing: retail’s not dead-it’s just… cheap. And at 14x earnings and a 4.3% yield, Target’s about as expensive as a secondhand sweater.
What if the economy doesn’t crash? What if Trump’s tariffs are just a tantrum? (Spoiler: they are.) Apple got tariff exemptions for iPhones in exchange for promises. The market’s pricing in a recession, but growth’s still growth. And Target’s finally pivoting. Maybe it’s not too late. Or maybe it’s just my delusions of grandeur. Either way, I’m buying.
3. PepsiCo: The Snack Chip That Won’t Die
PepsiCo (PEP) is the snack aisle’s reluctant hero. Down 26% from its 2023 high, it’s being punished for owning Frito-Lay and Quaker Oats. When inflation hit, its margins got squeezed like a soda can in a bear hug. And let’s not forget: people stopped buying Cheetos to save money. But here’s the thing: PepsiCo owns its bottling plants. Coca-Cola? It’s playing catch-up. And now PepsiCo’s slapping “prebiotic” on its cola and churning out healthier snacks. It’s like the snack world’s version of a midlife crisis-except this one’s profitable.
The market’s pricing in a slow recovery, but PepsiCo’s adapting. Supply chain tech, efficient distribution-this isn’t the same company that got smacked by inflation. And at 4% yield, it’s giving you a side hug while you’re still figuring out your life. (Which, let’s be honest, is most of us.)
You’re thinking, “What if they’re wrong?” Fair. I’ve been wrong about a lot of things. Like that time I invested in a company that makes “artisanal” pickles. But this? This is different. These stocks are being punished for things that either won’t matter (Keytruda‘s patents) or are already priced in (Target’s doom). And if they fail? You’ll still get your dividends. Or at least a steady stream of snack chips. 🍿
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2025-08-14 01:43