PepsiCo Holds Strong as Dividend Aristocrat with Over 3% Yield
PepsiCo (NASDAQ: PEP) continues to solidify its reputation as a reliable income-generating stock in the FMCG space, boasting a dividend yield that recently edged back above 3%. Despite a modest decline in share price this year, the multinational food and beverage giant remains a top choice among dividend-focused investors and long-term shareholders.
Over the past 12 months, PepsiCo shares have declined by more than 8%, underperforming the S&P 500’s gains. However, the company’s dependable dividend history and stable cash flow have reinforced investor confidence, particularly among those seeking resilience in their equity portfolios. As of now, PepsiCo has raised its dividend for 52 consecutive years, earning its place among Dividend Aristocrats—S&P 500 constituents with at least 25 consecutive years of dividend growth.
The current dividend yield stands at 3.2%, surpassing the 10-year U.S. Treasury yield and providing a compelling option for income-seeking investors. PepsiCo’s trailing 12-month payout of $5.42 per share equates to a payout ratio of roughly 68% of net income, demonstrating ongoing commitment to returning capital to shareholders while maintaining balance sheet strength.
PepsiCo’s broad product portfolio—which includes Pepsi-Cola, Gatorade, Lay’s, Tropicana, Doritos, and Quaker—has helped the company weather inflationary headwinds and shifts in consumer preferences. Diversification between beverages and snacks continues to mitigate category-specific volatility, giving the company defensive appeal despite broader macroeconomic uncertainty.
Recent institutional interest supports PepsiCo’s fundamentals. As of Q1 2024, 67 hedge funds reported positions in PepsiCo, with Fisher Asset Management and Fundsmith LLP ranking among the top holders. This ongoing institutional backing highlights confidence in the stock’s long-term prospects and dividend stability.
While analysts anticipate slower earnings growth this year amid normalization following pandemic-driven consumption uplift and inflation pressures, PepsiCo’s dependable dividend and pricing power keep it well-positioned. For FMCG players navigating margin compression and category realignment, the company offers a case study in balancing shareholder returns with operational resilience.
With its strong dividend track record, broad consumer reach, and consistent institutional backing, PepsiCo remains one of the most resilient income stocks in