5 Beaten-Down Dividend Kings Ready to Roar Back in 2027 (One Yields Over 5%)

2026 has been a positive year for all major exchanges, and the small-cap Russell 2000 remains the winner as we approach the fourth quarter, up 19.9%. The tech-heavy Nasdaq is up 14%, while the benchmark S&P 500 is higher by 12.8%. Last but not least, the venerable Dow Jones industrials is still in solid positive territory, up 11.1%. It is past time to look for value, dividend safety, quality, and stocks with meaningful upside for the rest of 2026 and next year.

We decided to screen the Dividend Kings, looking for companies that have underperformed this year but have strong upside potential for 2027. We picked the Dividend Kings because they rate highly with growth and income investors looking for passive income. The long-running AI/data center rally is losing steam, and those stocks are expensive. Now is the time to shift to value-priced Dividend Kings that will hold up better when the inevitable correction arrives.

Investors seeking defensive companies that pay substantial dividends are drawn to the Dividend Kings, and with good reason. The 59 companies that made the cut for the 2026 Dividend Kings list have increased their dividends (not just maintained them) for 50 consecutive years. Companies that have raised dividends for shareholders for 50 years or more are the kinds of investments passive income investors need. Dependability is crucial for individuals seeking to increase their annual income through dividend stock investments.

We screened 2026 Dividend Kings year-to-date performance numbers, looking for members that have underperformed the market benchmarks and have solid upside to Wall Street targets. Five top companies hit our screen, and all could be big winners next year, especially in a rising interest rate environment. Plus, all pay dependable dividends that have been raised every year for at least 50 years, and in many cases much longer.

Why We Recommend the Dividend Kings

Companies that have paid and raised dividends for 50 years or more are the kinds of stocks growth and income investors want to buy and hold in stock portfolios forever. These stocks are mostly conservative, and should we see a dramatic market correction, they will likely hold their ground much better than volatile technology stocks.

Hormel Foods

Hormel Foods (NYSE:HRL | HRL Price Prediction) is an American food processing company founded in 1891 in Austin, Minnesota. It offers dual pricing power through branded products and private-label manufacturing, along with a reliable 5.42% dividend. Hormel develops, processes, and distributes a range of meat, nuts, and other food products to retail, foodservice, deli, and commercial customers in the United States and internationally.

With shares down 3% in 2026, Hormel Foods offers dual pricing power through branded products and private-label manufacturing, along with a reliable dividend. Profit margins are weak due to elevated input costs and logistics inflation. While its retail volume dropped 9% in recent quarters, Hormel remains an attractive, high-yielding choice for defensive income seekers.

The company operates through three segments:

• Retail
• Food Service
• International

Hormel is a Dividend King with over 50 years of dividend increases and is a consumer staples company focused on protein-based packaged foods. Its yield is historically high, and the Hormel Foundation’s oversight ensures dividend reliability. Reports indicate that it is restructuring its portfolio and cutting costs to improve performance.

The company provides various perishable products, including fresh meats, frozen items, refrigerated meal solutions, sausages, hams, guacamoles, and bacon, and shelf-stable products, including canned luncheon meats, nut butter, snack nuts, chili, shelf-stable microwaveable meals, hash, stews, tortillas, salsas, tortilla chips, nutritional food supplements, and others. It sells its products under these brands:

• Hormel
• Always Tender
• Applegate
• Austin Blues
• Bacon 1
• Black Label
• Bread Ready
• Burke
• Café H
• Ceratti
• Chi-Chi’s
• Columbus
• Compleats
• Corn Nuts
• Cure 81
• Dan’s Prize
• Di Lusso
• Dinty Moore
• Don Miguel
• Doña Maria
• Embasa
• Fast N Easy
• Fire Braised
• Fontanini
• Happy Little Plants
• Herdez
• Hormel Gatherings
• Hormel Square Table
• Hormel Vital Cuisine
• House of Tsang
• Jennie-O
• Justin’s
• La Victoria
• Layout
• Lloyd’s
• Mary Kitchen
• Mr. Peanut
• Natural Choice
• Nut-rition
• Old Smokehouse
• Oven Ready
• Pillow Pack
• Planters
• Rosa Grande
• Sadler’s Smokehouse
• Skippy
• Spam
• Special Recipe
• Thick & Easy
• Valley Fresh
• Wholly

Barclays has an Overweight rating with a $30 target price.

Kimberly-Clark

Kimberly-Clark (NYSE:KMB) is an American multinational personal care company that primarily produces paper-based consumer products. The stock fell 23% in 2025, pushing it near a 12-year low, and its dividend has been raised for 53 consecutive years; the current yield is a rich 4.84%. Kimberly-Clark manufactures and markets personal care and consumer tissue products worldwide. The company is experiencing operational hurdles, highlighted by supply chain and market volatility in its overseas diaper business. While core profitability holds steady, organic revenue expansion continues to lag behind industry peers.

It operates through three segments. The Personal Care segment offers a diverse range of products, including:

• Disposable diapers
• Swim pants, training and youth pants, baby wipes
• Feminine and incontinence care products, as well as related products under the Huggies, Pull-Ups, Little Swimmers, GoodNites, DryNites, Sweety, Kotex, U by Kotex, Intimus, Depends, Plenitud, Softex, Poise, and other brand names

The Consumer Tissue segment provides facial and bathroom tissues, paper towels, napkins, and related products under these brand names:

• Kleenex
• Scott
• Cottonelle
• Viva
• Andrex
• Scottex
• Neve

The K-C Professional segment offers wipers, tissues, towels, apparel, soaps, and sanitizers under the Kleenex, Scott, WypAll, Kimtech, and KleenGuard brands.

In 2025, Kimberly-Clark announced it would acquire Kenvue (NYSE:KVUE) in a $48.7 billion deal, expected to close in the second half of 2026. The acquisition will create a combined consumer health and wellness company, with Kenvue shareholders receiving cash and stock. Kenvue shareholders will get $3.50 in cash plus 0.14625 shares of Kimberly-Clark.

Piper Sandler has an Overweight rating with a $121 target price.

Lowe’s

This is one of the best big-box retailers to own now, paying a solid 2.37% dividend, and with the potential for higher rates in the short term, do-it-yourself consumers could lead the way in 2027. Lowe’s Companies (NYSE:LOW) is a home improvement company. A prolonged drop-off has hit the company in do-it-yourself (DIY) consumer demand. As consumers grew increasingly cautious about home improvement spending, management revised its full-year sales and profit guidance downward.

Via over 1,700 home improvement stores, the company offers a complete line of products for construction, maintenance, repair, remodeling, and decorating. Its home improvement product categories include:

• Appliances
• Seasonal and outdoor living
• Lumber
• Lawn and garden
• Kitchens and baths
• Hardware
• Building materials
• Millwork
• Paint
• Rough plumbing
• Tools
• Electrical, flooring
• Decor

It is focused on offering a wide selection of national brand-name merchandise complemented by its selection of private brands. Its services include installed sales, Lowe’s Protection Plans, and Repair Services.

The company offers installation services through independent contractors in many product categories. It offers extended protection plans for certain products within the appliances, kitchens and bath, decor, millwork, rough plumbing, electrical, seasonal, outdoor living, tools, and hardware categories.

UBS has a Buy rating with a $275 target price.

PepsiCo

This top consumer staples pick reported surprisingly solid second-quarter earnings and will continue supplying goods for upcoming football tailgates and parties. PepsiCo (NASDAQ:PEP) is a global food and beverage company that pays a notable 4.18% dividend yield. The company’s low volatility (beta of 0.375) makes it a steady, defensive holding—ideal for investors waiting for a comeback. The company has faced some headwinds from consumer belt-tightening and a shift toward healthier snacks. North American food sales dipped as budget-conscious shoppers pulled back, forcing the company to cut prices on staple brands like Lay’s and Doritos. Down just over 4%, this is a great bounce-back candidate.

Its Frito-Lay North America segment offers:

• Lay’s and Ruffles potato chips
• Doritos, Tostitos, and Santitas tortilla chips
• Cheetos cheese-flavored snacks, branded dips
• Fritos corn chips

The Quaker Foods North America segment provides:

• Quaker Oatmeal
• Grits
• Rice cakes
• Natural granola and oat squares
• Pearl Milling mixes and syrups
• Quaker Chewy granola bars
• Cap’n Crunch cereal
• Life cereal
• Rice-A-Roni side dishes

PepsiCo’s North America Beverages segment offers beverage concentrates, fountain syrups, and finished goods under these brands:

• Pepsi
• Gatorade
• Mountain Dew
• Diet Pepsi
• Aquafina
• Diet Mountain Dew
• Tropicana Pure Premium
• Sierra Mist
• Mug

BNP Paribas has an Outperform rating to go with its $183 target price.

Procter & Gamble

Procter & Gamble (NYSE: PG) was founded more than 185 years ago as a soap-and-candle company. It has paid dividends to shareholders since 1891, raised them for 70 straight years, and currently pays a 2.89% dividend. P&G focuses on providing branded consumer packaged goods worldwide. This is one of the most widely held Dividend Kings, with a portfolio of essential consumer brands that generate steady cash flow through all economic cycles. P&G remains a favorite among retirees because its products are used in millions of households every single day. Even during economic downturns, consumers continue buying the company’s products, which helps support reliable dividend payments.

P&G has continued to grow its organic sales, but its pace has trailed the tech-heavy momentum of the broader S&P 500. Higher commodity, energy, and transportation costs, along with volume softness in Greater China, have capped capital appreciation. The shares are down 0.33% this year and 14.68% from the 52-week high, making it a solid pick at current levels.

The company’s segments include:

• Beauty
• Grooming
• Health Care
• Fabric & Home Care
• Baby
• Feminine & Family Care

Its products are sold in approximately 180 countries and territories primarily through mass merchandisers, e-commerce, including social commerce channels, grocery stores, membership club stores, drug stores, department stores, distributors, wholesalers, specialty beauty stores, including airport duty-free stores, high-frequency stores, pharmacies, electronics stores, and professional channels. It also sells directly to individual consumers and has operations in approximately 70 countries.

P&G offers products under such brands as:

• Head & Shoulders
• Herbal Essences
• Pantene
• Rejoice
• Olay
• Old Spice
• Safeguard
• Secret
• SK-II
• Braun
• Gillette
• Venus
• Crest
• Oral-B
• Ariel
• Downy
• Gain
• Tide
• Always
• Always Discreet
• Tampax
• Bounty

Citigroup has a Buy rating with a $170 target.

 

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