1 Dividend Growth Stock Down 45% to Buy Right Now

In the ever-changing landscape of the stock market, opportunities often arise when investors overreact to short-term challenges, leading to undervalued stocks. One such opportunity presents itself in Hormel Foods (HRL), a dividend growth stock that has seen its stock price decline by approximately 45% from its 5-year high. Despite this drop, Hormel's dividend growth story remains intact, making it an attractive investment opportunity for long-term investors.

Hormel Foods, a Dividend King with a 58-year streak of annual dividend increases, boasts an impressive 11% annualized dividend growth rate over the past decade. This is over three times the historical growth rate of inflation, indicating that Hormel's dividend has been growing in purchasing power. With a current yield of 3.7%, Hormel's dividend is significantly higher than the S&P 500's 1.2% and the consumer staples sector's 2.6%. This high yield suggests a discounted stock price, offering potential for capital appreciation as the company's fundamentals improve.

Despite recent challenges, Hormel's dividend growth story is still intact. The company's strong brand portfolio, including Hormel, SPAM, Skippy, and Jennie-O, provides a solid foundation for long-term growth. Recent headwinds, such as inflation-related cost increases and a slow pandemic recovery in China, have impacted the company's performance. However, Hormel's commitment to cost-cutting and innovation, along with its history of navigating headwinds, suggests that the company is well-positioned to recover and resume dividend growth.



Investors with a long-term perspective may find Hormel an attractive opportunity at its current discounted price. The company's strong dividend track record, combined with its commitment to growth and innovation, makes it a compelling investment in the consumer staples sector. As the market recovers and Hormel's fundamentals improve, investors can expect to benefit from both capital appreciation and dividend growth.

In conclusion, Hormel Foods (HRL) is a dividend growth stock that has seen its stock price decline by approximately 45% from its 5-year high. Despite this drop, Hormel's dividend growth story remains intact, with a 10-year dividend growth rate of 11% and a current yield of 3.7%. The company's strong brand portfolio and commitment to growth make it an attractive investment opportunity for long-term investors. As the market recovers and Hormel's fundamentals improve, investors can expect to benefit from both capital appreciation and dividend growth.