Grocery store stocks have endured a rough 2026. Tariff pressure, shoppers trading down to store brands, and years of underinvestment at some companies have pushed several major consumer goods names down double digits this year, even as the broader market sits near record highs.
A falling stock price doesn’t automatically mean a cheap business—sometimes a stock is cheap because it deserves to be. But a handful of these companies are paying real dividends while investors wait to find out which kind of cheap this actually is. For patient investors willing to hold through some uncomfortable near-term noise, three names in particular stand out for very different reasons: one is being forced into overdue change by outside pressure, another is benefiting from a favorable shift in input costs, and a third has a dividend track record spanning more than a century.
PepsiCo: Activist Pressure Forcing Overdue Change
PepsiCo currently trades around $129, hovering near its 52-week low of $123.47 and down sharply from a high above $171. The dividend yields roughly 4.6% and has been raised for 54 consecutive years, placing PepsiCo firmly in Dividend King territory.
What changed this year is the arrival of activist investor Elliott Management, which took a $4 billion stake and pushed PepsiCo into a formal agreement to cut its U.S. product lineup by roughly 20%, lower prices on core brands, and overhaul its North American supply chain. Rather than viewing this as a sign of weakness, it’s worth considering this outside pressure as the catalyst for changes management arguably should have made on its own years ago. If these cuts improve profitability and competitiveness as intended, the stock could see a meaningful reversal over the next several years.
Hershey: Riding the Cocoa Price Relief
Hershey shares sit around $169, off their 52-week low of $156, with the stock yielding approximately 3.6%. The company’s recent struggles trace directly back to soaring cocoa prices, which forced Hershey to quietly trim cocoa content in products like Reese’s and Hershey’s bars during the spike.
Cocoa prices have since fallen from last year’s peak, and Hershey is using that relief to bring its flagship products back to their original recipes. Management is guiding toward 30%-35% adjusted earnings growth this year—among the boldest forecasts anywhere in the food sector. If earnings genuinely follow through as cocoa costs normalize, Hershey’s current valuation could prove to be a compelling entry point for dividend-focused investors.
General Mills: A 127-Year Streak Without a Single Cut
General Mills has fallen roughly 30% in 2026 and sits near its 52-week low of $31.18, pushing the dividend yield above 7.5%. What makes this stock particularly notable is history: General Mills and its predecessor have paid an uninterrupted dividend since 1898—127 consecutive years—without a single cut, even through extended stretches without a raise.
Sales volume has softened as shoppers trade down to store brands, but management says fiscal 2027 will shift focus toward genuine product innovation, including protein and fiber additions, rather than simply defending prices against private-label competition. The case for holding General Mills through the current downturn is straightforward: a company that maintained its dividend through the Great Depression, two world wars, and every recession since likely isn’t going to abandon that streak because of a soft cereal aisle.
