5 Dividend Stocks to Buy in 2027 and Hold for the Next 5 Years

S&P 500 companies that grew or started paying dividends delivered total returns of about 10.2% a year from 1973 through 2025, versus about 4.2% for dividend non-payers, according to Hartford Funds and Ned Davis Research. That's a strong argument for building a 2027 portfolio around stocks that are reliable dividend growers.

Coca-Cola (NYSE: KO), Colgate-Palmolive (NYSE: CL), Procter & Gamble (NYSE: PG), PepsiCo (NASDAQ: PEP), and Target (NYSE: TGT) have each raised their payouts for over 50 straight years, through recessions, inflation spikes, the 2008 financial crisis, and the pandemic. Here's why these dividend stocks are worth buying in 2027 and holding for the next five years (or more), whatever the market brings.

Image source: Getty Images.

Coca-Cola

Coca-Cola has raised its dividend annually for 64 straight years, and at the current share price, it yields about 2.2% based on the quarterly payment of $0.53 per share. Management has hiked the dividend by an average of about 4.5% per year over the past five years. Importantly, over the past year, it distributed roughly 78% of free cash flow -- the cash left after running and reinvesting in the business. That leaves the company plenty of breathing room to further increase the dividend even if its profits or free cash flow don't grow in a given year.

Its bottling partners sell Coca-Cola, Sprite, and Fanta across developed and emerging markets. Demand for the company's many beverage brands remains fairly consistent regardless of the economy. Unit sales volume grew 5% year over year in the third quarter -- a strong result in an environment where affordability has been a key concern for consumers.

CEO Henrique Braun said the company's "confidence in the long-term opportunity remains unchanged." Analysts expect its earnings to grow by roughly 7% a year over the next five years, which should lead to more dividend increases.

Colgate-Palmolive

Colgate-Palmolive has raised its dividend annually for more than 60 straight years, and at the current share price, it yields about 2.2% based on the quarterly payment of $0.53 per share. Management has only hiked the dividend by an average of about 3% per year over the past five years, but it's currently paying out just 44% of trailing-12-month free cash flow, leaving it with plenty of room to deliver larger raises from here.

The consumer products company is the world's largest seller of toothpaste, with about 41% of the global market share. It also owns a host of popular soap brands, household cleansers, deodorants, and the Hill's pet food brand. All are the sorts of products that people use daily, and that households keep buying even when budgets tighten. In the third quarter, its organic sales growth (which excludes the impacts of currency swings and deals) was nearly 4% year over year.

In 2025, the company laid out a new strategic growth and productivity program. On its most recent earnings call last month, CEO Noel Wallace said the goal is "to emerge with a stronger business and an even more resilient business moving forward." Analysts expect about 5% annual earnings growth over the next five years.

Procter & Gamble

P&G has paid a dividend for 136 years and raised it for 70 straight years. It yields about 2.7% based on the quarterly payment of $1.0885 per share. Management has boosted the dividend by an average of about 5% per year over the past five years, and the dividend accounted for about 67% of trailing free cash flow.

Households will need products like Tide and Pampers in good times and bad. P&G holds over 35% of the global fabric care market where it competes. Across all product categories, the company's organic sales rose by 4% last quarter.

CFO Andre Schulten said P&G has "the brands, the capability, and most importantly, the people required to win." Analysts expect about 5% annual earnings growth over the next five years.

PepsiCo

PepsiCo has raised its dividend for 54 straight years and offers the highest yield among these five stocks, at about 4.3%, based on the quarterly payment of $1.48 per share. Management increased the payout by an average of nearly 7% a year over the past five years, and the company paid out about 75% of trailing free cash flow.

PepsiCo owns snack brands such as Lay's and Doritos as well as popular beverages such as Gatorade and Pepsi. That diversified brand portfolio can give some stability to sales when one category slows. Third-quarter organic revenue grew about 3% year over year, its fastest pace since late 2023, and CEO Ramon Laguarta said growth is "on its way to the long-term 4% that we want to get to."

Analysts expect about 5% annual earnings growth over the next five years. Paired with its high yield, that could add up to solid returns for shareholders.

Target

Target has paid a dividend every quarter since 1967, and CFO Jim Lee said the retail giant aims to "build on our more than 50-year record of annual increases." At the current share price, it yields nearly 3% based on the quarterly payment of $1.16 per share. Management has increased the payout by about 11% per year over the past five years, and the company distributed less than half of free cash flow over the past year.

Target sells everyday essentials that keep shoppers coming back. It experienced weaker sales during the high-inflation environment in recent years, but it has proven resilient over the last several decades. During its fiscal 2026 second quarter, which ended Aug. 1, comparable sales rose nearly 4% year over year, driven mostly by higher store traffic.

Analysts expect about 6% annual earnings growth over the next five years, which should help it keep the dividend growing.

John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Colgate-Palmolive and Target. The Motley Fool has a disclosure policy.