3 Magnificent S&P 500 Dividend Stocks Down 11% to 18% to Buy and Hold Forever

Group 1: Market Performance - The S&P 500 has shown strong performance in 2024, with a year-to-date increase of approximately 20% following a 24% rise in 2023 [1] - PPG Industries, SJW Group, and Archer-Daniels-Midland have experienced declines of 14%, 11%, and 18% respectively since the start of the year [1] Group 2: PPG Industries - PPG Industries revised its 2024 adjusted EPS outlook down to $8.15 to$8.30 from a previous guidance of $8.34 to$8.59, leading to a sell-off by investors [2] - The company has a strong track record with 52 consecutive years of dividend increases and generates robust free cash flow to support its dividend payments [2][3] - PPG's five-year average payout ratio stands at 44%, indicating a prudent approach to returning capital to shareholders [3] Group 3: SJW Group - SJW Group operates primarily in regulated markets, which accounted for about 95% of its net income in 2023, providing predictable cash flows for planning capital expenditures and dividend increases [4] - The company has completed over 25 acquisitions from 2010 to 2023, resulting in a 72% growth in its customer base [4] - SJW Group has maintained 80 consecutive years of dividend payments and 56 consecutive years of dividend increases, with a compound annual growth rate of over 6% in dividends over the past five years [5] Group 4: Archer-Daniels-Midland - Archer-Daniels-Midland faced challenges at the beginning of the year, including a C-suite shake-up and an accounting investigation, leading to a 23% decline in January [6] - The company projects a 2024 adjusted EPS of $5.25 to$6.25, indicating a year-over-year decline from $6.98 in 2023, which may deter short-term investors [7] - Despite recent challenges, the company has a long history of resilience, which may provide confidence to long-term investors [7] Group 5: Investment Opportunities - PPG, SJW, and Archer-Daniels-Midland are currently trading at attractive valuations, with discounts to their five-year operating cash flow multiples [8] - SJW Group offers a forward dividend yield of 2.8%, making it suitable for conservative investors, while Archer-Daniels-Midland has a higher yield of 3.4% for those willing to accept some volatility [8] - PPG provides a forward yield of 2.1% for investors interested in specialty materials [8]