Investors tend to gravitate toward safe dividend stocks to accumulate passive income and cushion market volatility. But sometimes, even strong, boring companies can break the market.
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In the last six months (from May 29 to Nov. 29) Walmart(NYSE: WMT) a staggering 42.5%, Clorox(NYSE: CLX) rose 30.4%, and Kenvue(NYSE: KVUE) increased by 27.6%. Here’s what’s driving all three stocks up and why they have what it takes to keep raising their shares for years to come.
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By selling the traders did Dollar General and Dollar Tree cycle cycle 52-week low and Target falls over 22% in one day after the last of its money, you can think that Walmart stock is lying in the belt of sales. But Walmart is up 72% year to date.
When an established retailer like Walmart makes a lot of money in a short period of time, it’s usually because the company is doing something completely unexpected. Walmart has sharpened the seemingly impossible needle of delivering everyday value to consumers while attracting high-net-worth customers.
In its most recent quarter, Walmart reported that its US business delivered 5.3% comparable sales growth with significant market shares in groceries and general merchandise. For the quarter, 75% of Walmart’s US revenue came from households earning over $100,000.
So by delivering everyday value, Walmart has attracted customers to its discretionary items at a time when many retailers are struggling. It’s not just pricing where Walmart is shining. Walmart services, such as Walmart+ contactless delivery service, Walmart Marketplace (business-to-business e-commerce tools), and Walmart Connect (retailer tools) are all thriving.
To top it all off, Walmart is using artificial intelligence and machine learning to gain customer insights and improve its in-store experience, digital, and internal processes.
Walmart is in competition alone, but the stock is too expensive, and the yield has fallen to 1%. However, Walmart is the Dividend King with 55 consecutive years of dividend increases. In February, Walmart raised its dividend by 9%, and I would expect a double-digit-percentage increase next February.
Add it all up, and Walmart may still be worth a look for investors who don’t mind low yields.
With 40 consecutive years of dividend hikes and a yield of 2.9%, Clorox immediately stands out as an income powerhouse. But unlike Walmart, Clorox isn’t at the top of its game — far from it now.
On October 30, Clorox reported its first earnings for 2025. It raised its guidance for the full fiscal year 2025 but confirmed organic sales growth of 3% to 5%. Clorox continues to spend a ton on advertising, which ate into revenue in the most recent quarter.
Given the challenges, investors may wonder why the stock is at an all-time high. The simple answer is that Wall Street cares more about where a company is going than where it has been. And there are many reasons to believe that Clorox is headed in the right direction.
The past few years have been a disaster for Clorox. There was an epidemic, which was once a boon to Clorox as customers flocked to cleaning products. But Clorox overestimated the trend of demand, believing that there will be a strong change in consumer behavior towards more hygiene and cleaning. That left Clorox to expand once pandemic restrictions eased.
And to make matters worse, Clorox was hit by a cyberattack in 2023. Its first-quarter fiscal 2024 sales were down 20%, and diluted earnings per share were down 75%. So given all these challenges, fiscal 2025 is truly the “normal year” we’ve seen from Clorox for some time.
It’s also worth noting that the price of Clorox has only risen 12.8% over the past five years. So the recent surge may be the market reacting to the fact that Clorox is returning to growth.
Clorox still has a way to go before it returns to its top-margin form. However, the stock may still be worth buying for patient investors looking for a high-yield option in the consumer sector.
In August 2023, Johnson & Johnson it divested its consumer health division in order to focus on its pharmaceutical and medical business segments. The resulting company, Kenvue, was named after “ken” — meaning knowledge — and “vue” — meaning view — to reflect the company’s understanding of human health solutions.
The spinoff provided great insight into the performance of legacy brands like Aveeno, Band-Aid, Listerine, Neutrogena, and Tylenol. As with many spinoffs, the market needed time to adjust to Kenvue. Even after its recent run, Kenvue is down 10.5% since its inception after it began trading in late 2023, followed by a further drop last summer.
Kenvue is far from a high-octane machine. But it’s a stable company that should be able to grow its share over time at a steady pace. Kenvue is a Dividend King because it inherited the status of J&J. But Kenvue’s increase in share was 2.5%. Kenvue needs to deliver a massive upgrade to be seen as an electronic currency. But the good news is that Kenvue already has a great yield of 3.4% and a reasonable forward P/E ratio of 21.1.
Risk-averse investors focused more on savings than capital appreciation may want to take a closer look at this high-yield value stock.
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Daniel Foelber has no position in any of the listed stocks. The Motley Fool has positions in and recommends Kenvue, Target, and Walmart. The Motley Fool recommends Johnson & Johnson and recommends the following options: long January 2026 $13 calls on Kenvue. The Motley Fool has a disclosure policy.
Like Passive Income? Then You’ll Love These Three Super Safe Dividend Stocks That Are Up Between 28% and 42% in Six Months. first published by The Motley Fool
