3 Dividend Aristocrats to Scoop Up During Market Pullbacks in June


  • Boring can be bountiful, especially with this trio that can generate steady income, no matter the market condition.
  • PepsiCo (PEP): Pepsi stock is flat year-to-date and any dip is a chance to buy the global giant.
  • Johnson & Johnson (JNJ): Johnson & Johnson has the longest history of raising dividends in the healthcare industry.
  • McDonald’s (MCD): McDonald’s has enjoyed sales growth over the past decade, and the recent slowdown could be temporary.
dividend aristocrat stocks - 3 Dividend Aristocrats to Scoop Up During Market Pullbacks in June

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If you are worried about the economy and how the market will move from here, it is ideal to invest in dividend stocks that pay, no matter the market situation. When you have dividend aristocrat stocks in your portfolio, you can ensure consistent payouts for years. These are companies that have raised their payouts for 25 consecutive years. They have enough liquidity to keep doing the same, in rain or shine.

It is not easy for companies to achieve the status of dividend aristocrats, and given the market situation, some of the best stocks have dipped due to a market pullback. This is your chance to scoop up the incredibly stable and highly rewarding dividend stocks.

Let’s explore three dividend stocks to buy in the current market pullback. 

PepsiCo (PEP)

Cans of PepsiCo's Pepsi soda are in a bucket of ice.
Source: suriyachan / Shutterstock.com

A household name, PepsiCo (NASDAQ:PEP) is a beverage and snacks giant with a global presence. The company is no longer just a beverage maker but owns some of the biggest snack brands including Frito Lay. Trading at $171, PEP stock hasn’t shown much of a movement since the beginning of the year. 

It was trading at the same level in January and has moved sideways over the past few months. The stock dropped 6% in the past 12 months. Therefore, this pullback is your chance to pounce on the dividend aristocrat. Despite beating expectations in the first-quarter results, the stock slipped. The core financials improved year-over-year (YOY), and the company reported an organic growth of 2.7% YOY. 

While the dividend payout ratio has remained stagnant over the past five years, its dividend yield and the dividends per share have increased. It has a yield of 3.14% and pays a quarterly dividend of $1.36 per share per quarter. The dividend aristocrat has raised dividends for over 60 years and has enough cash flow to keep doing so. 

Moreover, the current stock pullback is temporary since its growth story isn’t over yet. The international market is expanding, and PepsiCo enjoys healthy profitability. 

McDonald’s (MCD)

McDonald's golden arches
Source: Vytautas Kielaitis / Shutterstock

Having raised dividends for 46 consecutive years, McDonald’s (NYSE:MCD) can ensure steady passive income, no matter the market situation. Trading at $259, MCD stock has dropped 12% year-to-date (YTD). The stock was trading very close to $300 at the beginning of the year and has dropped significantly since then. This pullback is a chance for smart investors to load up on the restaurant stock.

Furthermore, the business has survived several economic uncertainties and reported impressive financials despite high inflation. It saw a 4.6% revenue jump to $6.17 billion, and the EPS came in at $2.70. The EPS came below expectations due to the change in consumer spending. This has impacted several companies across the industry but could be temporary. 

McDonald’s enjoys a dividend yield of 2.58% and pays a quarterly dividend of $1.67. If you look at the long-term picture, McDonald’s will continue to thrive and will not disappoint investors. It has aggressive expansion plans and aims to open nearly 10,000 new restaurants globally by 2027, to reach a total of 50,000 restaurants. 

It’s successful franchise model helps keep the cost of operations low while ensuring steady royalty income. This is one stock that will continue to reward investors, no matter where the market moves from here. MCD is one of the top dividend aristocrat stocks to add to your portfolio.

Johnson & Johnson (JNJ)

A red Johnson & Johnson (JNJ) sign hangs inside in Moscow, Russia.
Source: Alexander Tolstykh / Shutterstock.com

Down 8% YTD, Johnson & Johnson (NYSE:JNJ) stock is trading at $147 and is moving near the 52-week low which is your chance to grab this stock. JNJ is a well-known brand globally, and the company thrives on acquisitions and mergers. Recently, it completed the acquisition of Shockwave Medical, its push into the cardiovascular space. 

Also, this dividend aristocrat has raised annual dividends for 62 consecutive years, which is one of the longest in the healthcare industry. An important global player, the company has a massive portfolio of healthcare products and Medtech devices which ensure steady revenue growth. 

Besides regularly making money from the popular drugs, it has seen growth in the medical devices segment which was up 4% YOY in the first quarter. Yes, the company has reported lackluster performance in the past few years. But this doesn’t mean you can write it off. It is a highly specialized pure-play pharmaceutical company and one of the best dividend stocks to own.

Any pullback in Johnson & Johnson is a chance for you to snag the stock. It will keep rewarding shareholders for years to come and has managed to grow, despite several economic ups and downs. The company operates in an industry that will always keep growing, and innovation is the key to its success. With Johnson & Johnson, you can expect slow and steady growth over the years. 

On the date of publication, Vandita Jadeja did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Vandita Jadeja is a CPA and a freelance financial copywriter who loves to read and write about stocks. She believes in buying and holding for long term gains. Her knowledge of words and numbers helps her write clear stock analysis.

Article printed from InvestorPlace Media, https://investorplace.com/2024/06/3-dividend-aristocrats-to-scoop-up-during-market-pullbacks-in-june/.

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