Why General Mills, Inc. (GIS) Is Among the Best Income Stocks to Buy According to Analysts

General Mills, Inc. (GIS) has long been a favorite among income-oriented investors, and for good reason. The company's consistent dividend track record and sustained shareholder payouts over an extended period have made it a reliable choice for those seeking steady returns. As of December 13, 2024, GIS is ranked thirteenth on our list of the best income stocks to buy according to analysts, with an upside potential of nearly 12%.

One of the key factors contributing to General Mills' projected upside potential is its strong cash flow generation. In the most recent quarter, the company generated $624 million in operating cash flow, growing from $378 million in the same quarter last year. This robust cash flow allows General Mills to reward shareholders with growing dividends, as evidenced by its quarterly dividend of $0.60 per share and a dividend yield of 3.58% as of December 13.

General Mills' strategic portfolio reshaping and cost-cutting initiatives have also contributed to its consistent dividend payouts. The company's recent decision to sell its North American yogurt business to Lactalis and Sodiaal is a prime example of this. By focusing on core operations and driving growth, General Mills has been able to maintain its dividend payouts and attract investors seeking income-generating stocks.

Analysts have taken notice of General Mills' strong financial performance and have upgraded the stock to Buy from Neutral. BofA, in particular, has maintained an optimistic outlook on the company, noting its strategic efforts to stimulate growth and restore its valuation to typical levels. The firm's analysts anticipate that General Mills will achieve a quicker and more sustainable pace of organic sales growth compared to other center-store food companies.

In conclusion, General Mills, Inc. (GIS) is among the best income stocks to buy according to analysts due to its strong cash flow generation, strategic portfolio reshaping, and consistent dividend payouts. The company's projected upside potential, driven by its solid financial performance and analyst upgrades, makes it an attractive choice for income-oriented investors. As the company continues to focus on core operations and drive growth, it is well-positioned to maintain its dividend payouts and deliver steady returns to shareholders.