Conagra Brands

CAG

Market cap $9.21B

Shifting from higher-risk assets to consistent income sources is a natural progression for retirees.

Long-term bond yields continue to rise. But investors looking for income can still find plenty of attractive opportunities with dividend-paying stocks that have healthy yields. “23 stocks pay huge dividends. They should be a better bet than treasuries.” —Barron's Weekly reported in October, 2024. Steven Wieting, strategist at Citi Wealth, told Barron's a growing dividend is a tangible-benefit for shareholders and a hallmark of companies with strong balance-sheets. “Nobody can fake a dividend," he-said.

During times of turbulence and uncertainty in the markets, many investors turn to dividend-yielding stocks. These are often companies that have high free cash flows and reward shareholders with a high dividend payout.

Conagra now has the highest dividend yield in the S&P 500. Inflation has eaten into demand for its products.

Shares in Conagra Brands have begun 2026 on a strong note, with YTD gains of over 10%. The stock is still down over 25% over the last year and nearly 50% over the last five years. Despite the share price underperformance, the company has retained a dividend, which currently yields over 7%.

Inflation has negatively impacted consumer staples companies. Conagra stock has lost 50% of its value over the last three years.

Conagra Brands faces weak demand, margin pressure, and a 36% YoY bottom-line decline but remains attractive for income-focused investors. CAG's defensive appeal is challenged by shifting consumer preferences, volatile sentiment, and a push for healthier diets, making demand forecasts uncertain. The company targets long-term margin improvement through AI-driven operational efficiencies, though results will take years to materialize.

Conagra Brands currently has the highest payout ratio in the S&P 500 after LyondellBasell slashed its dividend in half.

With Conagra Brands, investors can collect a 7.6% dividend, as the company pursues multiple strategies to unlock shareholder value. Macy's is up more than 40% over the past year, but is still trading at a bargain basement valuation.

Conagra Brands is a large consumer staples company, but its brands aren't industry leaders. The company's financial performance hasn't been particularly strong.