Why These 3 Dividend Kings Could Thrive as Inflation Cools
Three well-known Dividend Kings—Federal Realty Trust, Hormel Foods, and Target—could see stronger performance as inflation slows. These companies have each raised their dividends for at least 50 consecutive years, making them reliable choices for long-term investors. Easing inflation may now boost their growth even further.
Dividend Kings are stocks with a track record of increasing payouts for half a century or more. Federal Realty Trust, Hormel Foods, and Target all meet this standard, offering forward dividend yields of 4.42%, 4.8%, and 4.5% respectively.
Lower inflation could bring particular advantages. Federal Realty Trust may benefit from potential interest rate adjustments and a stronger retail sector, lifting its valuation. Hormel Foods might see higher profitability as cost pressures ease, allowing for more generous dividend increases.
Target, however, has faced the steepest challenges in recent years. Its dividend growth stalled after 2022 due to retail sector struggles. But if inflation keeps falling, the company could reverse this trend, resuming aggressive dividend growth as expenses drop.
The shift toward lower inflation may create a more favourable environment for these Dividend Kings. Federal Realty Trust could gain from improved retail conditions, while Hormel Foods may strengthen its payouts with better margins. For Target, easing cost pressures might restore its dividend growth—offering investors renewed confidence in its long-term stability.
