Key Takeaways
- A hypothetical $600,000 portfolio split evenly across Comcast, Hormel Foods and AT&T pays about $31,300 a year in dividends at today’s prices, a 5.2% yield.
- Comcast and AT&T pay out well under half their free cash flow as dividends, though AT&T plans no raises and Comcast hasn’t said what it will pay after its planned split.
- Hormel Foods has the least cash behind its dividend: 82% of free cash flow over the last twelve months, and more than all of it in fiscal 2025.
- If Hormel halved its dividend, the portfolio’s income would fall to about $26,100 a year. If it stopped paying, the income would fall to about $20,800.
If you’re a retiree hunting for income, three household names are hard to ignore right now. Comcast (CMCSA), Hormel Foods (HRL) and AT&T (T) all yield more than 5% at today’s prices.
So let’s take a hypothetical retiree with $600,000 to invest, split evenly at $200,000 a stock. That buys about 8,080 shares of Comcast, about 9,010 of Hormel and about 9,120 of AT&T. At each company’s current dividend, those shares pay about $31,300 a year, or about $2,610 a month.
That’s a 5.2% yield on this part of the portfolio. (Of course, no one should ever own just three stocks.)
But each dividend check is only as good as the cash behind it, and these three look very different:
| Stock | Shares | Cost | Income a year | Share of income | Cash dividend payout ratio (TTM) |
|---|---|---|---|---|---|
| Comcast | 8,077 | $199,987 | $10,662 | 34% | 24% |
| Hormel Foods | 9,009 | $200,000 | $10,541 | 34% | 82% |
| AT&T | 9,124 | $199,998 | $10,128 | 32% | 44% |
| Total | $31,330 | 100% |
Sources: TIKR; dividends at each company’s current annual rate, whole shares at today’s prices; payout ratios over each company’s latest reported twelve months.
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Comcast has the most room to spare
Comcast is paying up to defend its broadband business. It lost 144,000 domestic broadband customers in the third quarter of 2026 as fiber and fixed-wireless rivals competed on price, and Co-CEO Michael Cavanagh said on the October call that its investments are “creating near-term financial pressure.”
Comcast still has plenty of cash behind its dividend, which rose from $0.92 a share in fiscal 2020 to $1.32 in fiscal 2025. Over the twelve months to Sept. 30, 2026, the dividend took a well-covered 24% of free cash flow. Free cash flow has run far ahead of dividends for a decade:
Analysts expect free cash flow of about $13.6 billion in fiscal 2026, which would lift the ratio to a still-comfortable 36%. The bigger unknown is the spin-off of NBCUniversal and Sky, which Comcast expects to finish by the middle of next year. Buybacks are paused until then, and the company hasn’t said what the two businesses will pay afterward.
Hormel’s cushion is the thinnest
Hormel is trimming parts of its grocery business on purpose, selling its whole-bird turkey line and exiting private-label snack nuts while strained shoppers buy less. Organic net sales fell 2% in its fiscal third quarter (ended July 26, 2026). Foodservice still grew for a 12th straight quarter, and management raised its fiscal 2026 adjusted EPS guidance to $1.45-$1.51.
Cash is the problem. Free cash flow fell from $1.01 billion in fiscal 2024 to $534 million in fiscal 2025, short of the $633 million Hormel paid in dividends:
Free cash flow has recovered since, but dividends still took a stretched 82% of it over the twelve months to July 26, 2026. And on Sept. 30, Hormel agreed to buy chicken maker Brakebush Brothers for about $1.06 billion, paid with cash on hand and new debt.
Hormel’s dividend grew 4.5% a year from fiscal 2020 to fiscal 2025 ($0.93 to $1.16 a share), about half its 8.8% pace over the ten years to fiscal 2025. John Ghingo, who took over as CEO on Oct. 26, said on the August call that “the dividend continues to be very important to us.”
AT&T plans to hold the line
AT&T is swapping copper for fiber. Revenue from its legacy business fell 24.5% in the third quarter of 2026 as it shuts down copper, but total revenue rose 5.3% to $32.3 billion. On Oct. 21, AT&T raised its 2026 adjusted EPS outlook to about $2.40, and it expects more than $18 billion of free cash flow this year.
That leaves the dividend well-covered: 44% of free cash flow over the twelve months to Sept. 30, 2026, and 46% expected for fiscal 2026. But AT&T plans to keep the dividend at $1.11 a share a year, alongside about $10 billion of buybacks this year.
Longtime holders will remember the cut behind that low payout. The dividend went from $2.08 a share in fiscal 2020 to $1.11 in fiscal 2025, and dividends paid fell from $15.1 billion in fiscal 2021 to $8.14 billion in fiscal 2023:
The risk is debt. AT&T puts its net debt at 3.13x adjusted EBITDA after its EchoStar spectrum purchase, and it doesn’t expect to get back to its 2.5x target until 2029.
Hormel is the check I’d watch
Hormel’s is the check to test, since it has the least cash behind it. If Hormel halved its dividend, this portfolio’s income would fall to about $26,100 a year. If it stopped paying, the income would fall to about $20,800. Nothing the company has said points to a cut, and with net debt at 1.19x EBITDA, it has room to borrow.
The way I see it, AT&T’s check is the most dependable: management has said exactly what it will pay, and it pays out under half its free cash flow to do it. Just don’t expect raises. Comcast’s dividend is safe and growing today, with the most cushion of the three.
Of course, the Comcast stake here could be two stocks by the middle of next year, and I’d want to hear what each plans to pay before counting on that $10,700 a year. Hormel’s first results under Ghingo will also show whether its cash is catching up to its dividend.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
