4 Cheap Dividend Stocks Passive Income Investors Can Buy Right Now and Never Sell

Parkev Tatevosian, CFA•Sep 29, 2026

Summary

Parkev focuses on identifying established companies that have proven their resilience over decades, using past performance as a proxy for future stability. Parkev calculates fair values based on future free cash flow projections to identify significant upside potential in the consumer goods sector despite current economic pressures on low-to-middle-income consumers.

McDonald's: Parkev believes McDonald's is a top pick due to upcoming AI integration in drive-thrus and the potential for delivery robots to reduce costs. Parkev sets a fair value of $299, suggesting a 26% upside from the current $237 price despite a projected weak 2026 due to macro headwinds. Parkev notes that while health trends are a risk, the company's efficiency will allow it to adapt and offer healthier options more consistently than competitors.

PepsiCo: Parkev highlights PepsiCo's strong snack segment as a primary growth driver that is performing as well as, if not better than, its beverage business. Parkev calculates a fair value of $180 against a market price of $128, representing over 40% upside potential. Parkev acknowledges that tariffs and lower disposable income are significant headwinds, but expects the company to successfully transition its portfolio toward healthier choices over time.

Procter & Gamble: Parkev describes Procter & Gamble as one of the best-managed companies globally, particularly praising its leadership development and brand execution. Parkev estimates a fair value of $167, offering a 14% upside from the current $146 price level. Parkev views the company as a stable long-term hold that will continue to repeat its successful formula of brand delivery for decades to come.

General Mills: Parkev identifies General Mills as an undervalued opportunity with a fair value of $40 compared to its current price under $34. Parkev notes that although consumers are currently trading down to cheaper store brands due to inflation, this is a cyclical challenge that the company has navigated before. Parkev emphasizes its industry-leading dividend yield of 7.2% as a key attraction for patient investors looking for long-term income.

Mentioned Stocks

MCD

Sentiment: BUYAction: RECOMMENDED

Reasoning: Parkev is highly optimistic about McDonald's due to AI innovation at drive-thrus and delivery robotics. Parkev calculates a fair value of $299 per share, which is significantly above the current price of $237, representing a 26% upside. Parkev also notes a dividend yield of over 3%.

Loading chart...

Sentiment: BUYAction: RECOMMENDED

Reasoning: Parkev considers Procter & Gamble to be exceptionally well-managed with a robust leadership pipeline. Parkev sets a fair value of $167 against a $146 market price, projecting a 14% upside plus a 3% dividend yield.

Loading chart...

GIS

Sentiment: BUYAction: RECOMMENDED

Reasoning: Parkev identifies a 17% upside potential for General Mills, calculating a fair value of $40 against a current price under $34. Parkev highlights the high dividend yield of 7.2% and views the current shift toward store brands as a short-term cyclical challenge.

Loading chart...

PEP

Sentiment: BUYAction: RECOMMENDED

Reasoning: Parkev sees over 40% upside for PepsiCo, with a fair value of $180 compared to a market price of $128. Parkev values the strength of the snack segment and expects the company to adapt to health-conscious consumer trends. The dividend yield is noted at 4.5%.

Loading chart...