12 Best Consumer Cyclical Dividend Stocks to Buy Right Now

1. The Home Depot, Inc. (NYSE:HD)

Number of Hedge Fund Holders: 88

The Home Depot, Inc. (NYSE:HD) is an American multinational home improvement company. With operations spanning more than 2,300 locations across North America, the company’s performance remains closely linked to trends in the real estate market. While it has continued to experience steady growth and maintain strong profitability, elevated mortgage rates have presented challenges. Higher borrowing costs have led to a decline in home sales and a reduced supply of available properties, which has, in turn, impacted consumer spending on home improvement projects.

The Home Depot, Inc. (NYSE:HD) reported strong fourth-quarter earnings for 2024, with revenue reaching $39.7 billion, reflecting a year-over-year increase of over 14%. Looking ahead to fiscal 2025, it expects total sales to grow by approximately 2.8%, with comparable sales projected to rise by about 1% over the same 52-week period. Additionally, it plans to open around 13 new stores and anticipates a gross margin of approximately 33.4%.

The Home Depot, Inc. (NYSE:HD) ended the quarter with over $1.65 billion in cash and cash equivalents. Throughout fiscal 2024, the company generated nearly $20 billion in operating cash flow, reinforcing its strong financial position. This stability has enabled it to maintain uninterrupted dividend payments for 152 consecutive quarters. Moreover, it increased its quarterly dividend by 2.2% to $2.30 per share, marking the 15th consecutive year of dividend growth. As of March 4, the stock supports a dividend yield of 2.41%.

Overall, The Home Depot, Inc. (NYSE:HD) ranks first on our list of the best dividend stocks in the consumer staples sector. While we acknowledge the potential for HD as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than HD but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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