3 High-Yield Dividend Stocks That Look Dirt Cheap on 2027 Earnings

Wall Street loves a stock that gets cheaper the further you look out. Three NYSE-listed dividend payers currently fit that setup: their forward price-to-earnings multiples sit at or below their trailing multiples, meaning analysts expect earnings power to grow into today’s price. The clearest example is Dow, which carries a forward P/E of 12 against a trailing multiple that is effectively unmeasurable because trailing EPS is negative. Here is how the income case stacks up for all three.

Dow: A Chemicals Cyclical Rebuilding Earnings Power

Dow (NYSE:DOW | DOW Price Prediction) pays a quarterly dividend of $0.35 for an annual yield of 4.45%. Shares trade at a forward P/E of 12, well below where trailing earnings can support a multiple given a diluted TTM EPS of -$1.76.

Dividend safety can be a real sticking point here. Dow cut its quarterly payout from $0.70 to $0.35 beginning with the August 29, 2025 ex-date, so the current level reflects a reset, not a streak. What has improved is coverage: Q2 2026 net sales of $12.1 billion rose 20% year over year, operating EBITDA reached $2.3 billion, and free cash flow was $692 million against $253 million returned via dividends. Management is guiding to roughly $1.7 billion of Q3 EBITDA and more than $1.3 billion of self-help benefits this year, with approximately $14 billion of total available liquidity and no substantive debt maturities until 2029.

For the bull case, a lower payout is a healthier payout, and Transform to Outperform is targeting a $2 billion opportunity by the end of next year that should widen dividend coverage as polyethylene margins normalize. On the other hand the risk is relatively straightforward: Dow is a global chemicals cyclical facing industry overcapacity and softer North American polyethylene pricing, so another leg down in the cycle would test the reset payout again.

U.S. Bancorp: A Regional Bank With Widening Margins and a Growing Payout

U.S. Bancorp (NYSE:USB) yields 3.33% on a $0.52 quarterly dividend, and trades at a forward P/E of 12 versus a trailing P/E of 12. Investors are paying slightly less for next year’s earnings than for the last twelve months.

Coverage looks solid. Trailing diluted EPS is $5.04 against a $2.08 annualized dividend, leaving room to grow the payout, which is exactly what management is doing. The Q3 2025 dividend rose from $0.50 to $0.52, and a further roughly 4% increase is planned for Q3 2026 pending board approval. Second-quarter fundamentals support that: EPS of $1.35 was up about 22% year over year, net interest income of $4.4 billion grew 7.5%, the CET1 ratio stood at 10.8%, and management sees a path toward a 3% net interest margin next year.

For income investors, USB is the classic combination: a growing dividend, a payout ratio comfortably below half of EPS, and a business whose return on tangible common equity of 18.7% supports continued increases. The caveat here is credit with commercial real estate and office nonperforming loans remaining a watch item. Also, the $160 million reserve build tied to the Amazon small-business portfolio is a reminder that new balance-sheet exposure comes with new provisioning.

Target: Half-Century Dividend Record Meets a Cheaper Forward Multiple

Target (NYSE:TGT) yields 2.79% on a $1.16 quarterly dividend, and trades at a forward P/E of 17 versus a trailing P/E of 17. The gap is narrow, but it points in the right direction as earnings recover.

The dividend track record is the anchor. Management pointed on the Q2 call to “our more than 50-year record of annual increases” and is targeting a 40% payout ratio over time. The recent bump from $1.14 to $1.16 per quarter continues a ladder of hikes going back years. Coverage is comfortable: trailing diluted EPS of $9.64 supports a $4.56 annualized dividend, and Target guided FY2026 EPS to a range of $9.90 to $10.90. FY25 operating cash flow was $6.56 billion, and Target paid $518 million in Q2 dividends while keeping capex funded.

Traffic rose 3.6% in Q2, digital comps grew 8.7%, and higher-margin businesses like Roundel grew nearly 20% and Target Plus Marketplace GMV grew more than 40%, which is exactly the mix a dividend investor wants funding future raises. A 50-plus-year streak puts Target in rare company, and we ranked ten of those Dividend Kings by valuation in a free report here. The risk is that the $1.65 per share Q2 benefit from IEEPA tariff refunds is one-time, and management flagged that home and apparel recovery will extend into 2027 and beyond.

Bottom Line

Each of these three names shares the same setup: forward earnings support the current dividend more comfortably than trailing results do. Dow is the highest-yielding and most cyclical, rebuilding coverage after a payout reset. U.S. Bancorp offers the cleanest earnings growth story with a rising dividend on a mid-teens ROTCE. Target brings the deepest dividend history and a multiple that stops getting more expensive as EPS recovers. Investors focused on income should weight the mix by how much cyclicality they can tolerate to earn the extra yield.

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