Zacks Investment Ideas offer highlights: Coca-Cola, Pfizer and Altria

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Chicago, IL – October 2, 2024 – Today, Zacks Investment Ideas highlights The Coca-Cola Company KO, Pfizer PFE and Altria MO.

3 Constant Dividend Stocks for Passive Income: KO, PFE, MO

Everyone loves dividends because they provide a passive income stream, limit losses in other positions, and provide more than one way to profit from an investment.

And when considering dividend stocks, the focus is on stocks with a history of increasing their payouts, reflecting their commitment to increasingly rewarding shareholders.

Of course, consistent dividend increases and the decision to share part of the profits are also a recipe for success.

For those looking for companies that have consistently increased their payouts over time:The Coca-Cola Company, Pfizer And Altria meet the criteria. Let's take a closer look at each one.

Altria remains a dividend favorite

Altria, a current Zacks Rank #2 (Buy), has long been a favorite among income investors and maintains Dividend Aristocrat status. The tobacco giant has undergone significant change in recent years due to increasing health concerns and is now expanding into the smoke-free category.

The company's prospects have improved modestly across most of the past few months, with shares up an impressive 35% in 2024.

And it's still a high-yield stock, with shares currently returning 8% annually, compared to the S&P 500's return of 1.2%. The company has always been shareholder-friendly, reflected in its aforementioned status in the Dividend Aristocrats Club and a five-year annual dividend growth rate of 4%.

Below is a chart illustrating the company's annual dividends paid, with the final value tracked on a trailing twelve month basis. The company paid dividends of $1.7 billion and $3.4 billion in the second quarter and first half of 2024, respectively.

It's also worth noting that Altria has seen continued margin expansion over the past few years, leading to higher profitability.

Can Pfizer get back on its feet?

Pfizer shares have been mostly disappointing, falling nearly 30% over the past two years and significantly underperforming after a notable rise during the pandemic era. Still, the company's outlook has seen positive changes recently, which bodes well for its near-term performance and has propelled it to a favorable Zacks Rank #2 (Buy).

Still, poor stock performance has pushed the stock into a high-yield scenario, currently yielding a solid 5.8% per year. And dividend growth has remained stable: five payout increases in the last five years, representing an annual dividend growth rate of 3% over five years.

The story continues

The valuation picture here has also become much more bearable, with the current PEG ratio of 1.2 comparing favorably to a five-year high of 4.3x and a median of 1.3x. The stock has a style score of “B” for Value.

Coca-Cola continues to pay

Like MO, Coca-Cola maintains a place in the elite group of dividend aristocrats thanks to years of consistently higher payouts, with the stock also sporting a favorable Zacks Rank #2 (Buy) thanks to a constructive earnings outlook

Analysts revised their profit expectations for the current year positively after the latest earnings release and have remained stable since then. The company continued to record positive growth in printing, with profits increasing by 8% and sales increasing by 3%.

The valuation picture is a bit high here, as the current 3.8x PEG ratio is above the 3.4x five-year median and is undoubtedly expensive. However, it is worth noting that the shares have been trading at a high valuation in recent years, which likely reflects the company's solid reputation and “stable” nature.

Conclusion

Everyone loves dividends, essentially investors' form of payday. They can help limit drawdowns in other positions and provide a source of passive income – two key features that benefit all market participants.

And for those looking for companies with a history of consistent payouts, all three of the above tick the boxes.

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Past performance is no guarantee of future results. Every investment carries the potential for losses. This material is provided for informational purposes only and nothing contained herein constitutes investment, legal, accounting or tax advice or a recommendation to buy, sell or hold any security. No recommendation or advice is given as to whether an investment should be made for you is suitable for certain investors. It should not be assumed that the investments in any security, company, sector or market identified and described have been or will be profitable. All information is current at the time of publication and is subject to change without notice. The views or opinions expressed may not reflect those of the Company as a whole. Zacks Investment Research does not engage in any securities investment banking, market making, or asset management activities. These returns come from hypothetical portfolios consisting of Zacks Rank = 1 stocks that are rebalanced monthly without transaction costs. These are not the returns of actual stock portfolios. The S&P 500 is an unmanaged index. Visit for information about the performance figures displayed in this press release.

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CocaCola Company (The) (KO): Free stock analysis report

Pfizer Inc. (PFE): Free Stock Analysis Report

Altria Group, Inc. (MO): Free stock analysis report

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