In times of market volatility, investors often find solace in companies that consistently distribute growing dividends. Two industry giants, currently trading at a significant discount, offer attractive yields that are hard to ignore.
The recent appointment of Elliott Hill as CEO of Nike marks a new chapter for the sportswear giant. With a 51% decline from its all-time high, the stock has been under pressure due to weak revenue performance. However, Hill’s experience in expanding Nike’s global business could be the catalyst for a turnaround. Despite a 2% year-over-year revenue decline in the latest quarter, core categories like basketball and fitness showed growth, highlighting opportunities for improvement. With 22 consecutive years of growing dividends, Nike’s forward yield stands at 1.70%, outpacing the S&P 500 average.
Meanwhile, UPS has been paying dividends for 25 years, reflecting its solid financial performance. Although revenue has been stagnant, the company’s historically high dividend yield makes it an attractive opportunity. With a 45% decline from its peak, UPS’s current quarterly dividend of $1.63 per share translates to a forward yield of 5.05%. Management’s free cash flow guidance and recent volume growth suggest that the dividend is secure. The acquisition of Estafeta, a leading Mexican package company, also positions UPS for long-term growth.
Investing in industry leaders during temporary setbacks can lead to impressive returns. Nike and UPS are well-established companies that will continue to pay dividends to investors for years to come.
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