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David Jagielski, CPA, The Motley Fool
Wed, June 10, 2026 astatine 9:50 AM CDT 5 min read
Investing successful dividend stocks tin beryllium tricky due to the fact that portion you whitethorn privation to unafraid a precocious yield, you don't privation to instrumentality connected excessively overmuch risk, either. That's why, erstwhile yields get reasonably precocious (i.e., much than 5%), determination tin beryllium immoderate hesitancy successful the market; investors whitethorn not needfully beryllium loading up connected these types of stocks, adjacent if determination are mean risks astir them.
A mates of peculiarly high-yielding stocks contiguous see Campbell's (NASDAQ: CPB) and General Mills (NYSE: GIS). These 2 iconic food companies connection investors yields that are astir 7%. That's incredibly precocious erstwhile you see the S&P 500 is averaging a overmuch much humble output of conscionable implicit 1%. Which of these stocks is the safer enactment close now?
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Are their yields sustainable?
The burning question erstwhile it comes to high-yielding stocks is ever whether the dividend income is sustainable oregon not. If it's not, there's small crushed to put successful a dividend banal if it simply ends up cutting oregon suspending its payout successful the adjacent future.
By looking astatine a company's astir caller net report, investors tin get a glimpse of whether the concern is increasing and conscionable however overmuch sum it has for its dividend.
Campbell's reported its latest net earlier this week, and income declined 4% twelvemonth implicit year, though absorption said the results were successful enactment with expectations. It's not a immense driblet successful revenue, and the bigger contented is the "inflation-driven borderline headwinds" CEO Mick Beekhuizen pointed out. The cardinal fig for investors is the 41 cents per stock the institution reported successful net for the astir caller period, which ended May 3. That's somewhat higher than the 39 cents it pays successful quarterly dividends. There's not a immense buffer there, but the dividend appears sustainable for now.
General Mills reported its latest net numbers backmost successful March, and it experienced an adjacent worse diminution connected the apical line, with gross falling by 8% to $4.4 cardinal for the play ending Feb. 22. What's worse was that its nett net plummeted by 52% arsenic restructuring costs and little margins weighed connected its bottommost line. Overall, its diluted per-share nett was $0.56, falling abbreviated of the $0.61 it pays successful dividends per quarter. While that doesn't mean a chopped is inevitable, determination is immoderate origin for concern.
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