Investing in dividend stocks close to their 52-week lows offers a chance to earn higher yields. When a stock’s price drops, its dividend yield rises. If the company’s fundamentals remain strong, investors can gain from steady dividend payments and potential stock price recovery.
Here are three stocks yielding over 4% that are near their yearly lows: PepsiCo, General Mills, and Chevron. Each has faced a rough start in 2025, but they present compelling investment opportunities for a $5,000 allocation.
1. PepsiCo (PEP)
PepsiCo’s stock has fallen about 15% this year. Its recent quarterly sales were $17.9 billion, down 1.8% from last year, and operating profit dropped 4.9%. These results reflect consumer caution amid inflation and recession fears.
Despite this, PepsiCo is expanding. It recently acquired Poppi, a $2 billion prebiotic soda brand targeting health-conscious buyers. This move could boost growth.
PepsiCo offers a 4.4% dividend yield, much higher than the S&P 500 average of 1.3%. Its payout ratio is around 80%, which is somewhat high but not alarming. As a Dividend King with 53 years of consecutive dividend increases, PepsiCo’s dividend looks secure.
The stock trades near its 52-week low with a price-to-earnings ratio of 19. Investing $5,000 could generate about $220 in annual dividends and potential capital gains if the stock rebounds.
2. General Mills (GIS)
General Mills pays a 4.5% dividend and has dropped 16% this year, also near its 52-week low. Its recent quarter showed $4.8 billion in sales, down 5%, and operating profit declined 2.1%. The company gained $95.9 million from selling its Canada Yogurt business to focus on higher-growth areas.
General Mills operates across snacks, cereals, and baking. Streamlining its portfolio and cutting costs could improve margins and future results. Its payout ratio is just above 50%, indicating a safe dividend.
For income investors, General Mills offers reliable cash flow and a stable dividend.
3. Chevron (CVX)
Chevron yields about 5%, the highest on this list. The oil giant’s profits fell 36% year over year to $3.5 billion in the latest quarter, hurt by lower crude prices.
Oil stocks are volatile due to fluctuating commodity prices. However, Chevron has raised its dividend for 38 straight years, showing resilience.
The stock is down 6% this year and trades at 16 times trailing earnings, close to its 52-week low. As a major oil producer, Chevron remains a solid long-term dividend stock despite market swings.
Conclusion
PepsiCo, General Mills, and Chevron are attractive dividend stocks trading near their lows. Each offers yields above 4%, with potential for dividend income and price recovery. A $5,000 investment in any of these could provide steady income and growth opportunities.
