High-dividend stocks are stocks with a dividend yield well in excess of the market average dividend yield of ~1.3%. High-yield stocks can be very helpful to shore up income after retirement.
However, not all high-dividend stocks are equally safe. There are many examples of high dividend stocks reducing or eliminating their dividends.
As a result, income investors should try to find dividend stocks that not just have high yields, but also have sustainable payouts backed by strong underlying fundamentals.
In this article, we have analyzed 3 high dividend stocks with ultra-safe dividends.
PepsiCo Inc. (PEP)
PepsiCo is a global food and beverage company. Its products include Pepsi, Mountain Dew, Frito-Lay chips, Gatorade, Tropicana orange juice and Quaker foods. Its business is split roughly 60-40 in terms of food and beverage revenue. It is also balanced geographically between the U.S. and the rest of the world.
On July 18th, 2025, PepsiCo announced second quarter earnings results for the period ending June 30th, 2025. For the quarter, revenue grew 1.0% to $22.7 billion, which topped estimates by $430 million.
Adjusted earnings-per-share of $2.12 compared unfavorably to $2.28 the prior year, but this was $0.09 ahead of expectations. Currency exchange reduced revenue by 1.5% and adjusted earnings-per-share by 5%. Organic sales grew 2.1% for the second quarter.
PepsiCo grew earnings at a rate of 6.4% per year from 2015 to 2024, but this growth rate expands to 8.1% when looking at just the last five years. PepsiCo is a relatively recession-proof company. Earnings grew during the last recession and it offers a generous dividend yield.
The company is expecting to return $8.6 billion in cash to shareholders in the form of dividends and share repurchases in 2025. PepsiCo has several key competitive advantages that set it apart from the competition. The company is one of the largest in its sector, which gives it pricing power with vendors.
PepsiCo has raised its dividend for more than 50 consecutive years, making the company a member of the Dividend Kings.
Hormel Foods (HRL)
Hormel Foods was founded back in 1891 in Minnesota. Since that time, the company has grown into a juggernaut in the food products industry with nearly $10 billion in annual revenue. Hormel has kept with its core competency as a processor of meat products for well over a hundred years, but has also grown into other business lines through acquisitions.
Hormel has a large portfolio of category-leading brands. Just a few of its top brands include include Skippy, SPAM, Applegate, Justin’s, and more than 30 others.
Relatively consistent results have come from a steady stream of acquisitions and a bit of organic growth. This has afforded Hormel the ability to consistently raise its dividend as well. We are forecasting forward earnings growth of 6% annually as Hormel has been building its margin profile recently. We see sales growth as the primary driver of earnings-per-share expansion moving forward.
Hormel’s main competitive advantage is its ~40 products that are either #1 or #2 in their category. Hormel has brands that are proven, and that leadership position is difficult for competitors to supplant. In addition, Hormel has a global network of distributors that few food companies can rival. Hormel’s earnings-per-share actually grew during the Great Recession, a testament to the company’s defensive nature.
The company has increased its dividend for 59 consecutive years and currently yields 4.0%.
Northwest Natural Holding (NWN)
Northwest was founded over 160 years ago as a natural gas utility in Portland, Oregon. It has grown from a very small, local utility that provided gas service to a handful of customers to a very successful regional utility with interests that now include water and wastewater, which were purchased in recent acquisitions.
The company reported second-quarter financial results on August 5th. Non-GAAP EPS of $0.01 beat analyst expectations by $0.14, while revenue of $236.19 rose 11.6% year-over-year. Along with quarterly results, the company updated 2025 GAAP EPS guidance to $2.60 to $2.80 and reaffirmed adjusted 2025 EPS guidance of $2.75 to $2.95. It also reaffirmed its long-term EPS growth rate target of 4% to 6% from expected 2025 adjusted EPS.
We are forecasting an average growth rate of 4.3% for the next five years as NW Natural pushes through approved pricing increases and continues to acquire customers at low-single-digit rates, as it did with the new Oregon rate case. NW Natural also has its water utilities business that will provide a small amount of growth, but higher earnings will primarily come from customer and pricing growth while the company invests in its water business for longer-term growth.
NW Natural’s quality metrics have been very steady in the past decade. Seventy-six percent of its total assets are encumbered by debt, which is completely acceptable for a utility. Its interest coverage is fairly strong, so there are certainly no financing concerns moving forward.
The company’s dividend has been raised for 69 consecutive years, and the stock currently yields 4.7%.
Disclosure: No positions in any stocks mentioned.
_______________
Bob Ciura has worked at Sure Dividend since October 2016. He oversees all content for Sure Dividend and its partner sites. Bob received a Bachelor’s degree in Finance from DePaul.
© 2025 Newsmax Finance. All rights reserved.