PepsiCo (NASDAQ: PEP) and Hershey (NYSE: HSY) are both down about 12.5% year to date, as of Oct.

1, 2026. Both sell everyday brands people buy year-round, and that steady demand helps support generous dividends for income investors. With stable sales from soft drinks, chocolate, and snacks, these can be anchor dividend stocks you hold for decades -- as long as the investment case holds up.

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Act 2 Could Be 14x Bigger. Most investors think they missed the AI boat because they didn't buy Nvidia in 2005. But according to our analysts, we're only at the end of "Act 1"—the R&D phase. "Act 2" is the global rollout. Continue » Today, both still have enough going for them to justify buying the dip and holding for the long haul. Image source: Getty Images. PepsiCo stock is down, while sales volume is turning up PepsiCo owns iconic snack and beverage brands including Lay's, Doritos, Gatorade, Pepsi, and Quaker. The company raised its quarterly dividend by 4% in 2026, extending its streak to 54 consecutive annual increases. That pushes its forward dividend yield to an above-average 4.63%.

PepsiCo and other consumer staples have faced weak consumer spending and financial performance in recent years, weighing on their stock prices. But Pepsico is showing improvement. Its food business is gaining market share. Global food sales volumes rose 3% year over year in the first half of the year, following management's decision to hold prices at affordable levels to bring shoppers back in an inflationary environment. Beverage volumes were also up 2% year over year. Trailing-12-month free cash flow reached a record $9.2 billion in Q2 2026, and the company returned 84% of that to shareholders through dividends over the past year.

Improving sales momentum and record cash generation make now a great time to lock in a high yield on this top consumer staple for the long term. Hershey has paid a consistent dividend for 96 years Hershey makes Reese's, Kisses, Dot's Homestyle Pretzels, Skinny Pop, and many other snack and candy brands. Higher cocoa prices have pressured its financial results and the stock price over the past few years, but this 132-year-old company is battle-tested. It has paid a dividend every year for 96 years. The company declared a quarterly dividend of $1.452 per share on July 29, 2026, putting its forward dividend yield at 3.65%. Hershey is starting to recover from the cocoa price shock.

The company is using its scale to invest in automation and expand manufacturing capacity, with a focus on supporting fast-growing brands like Dot's.

For 2026, management expects organic sales growth of 3% to 3.5% versus 2025, along with adjusted earnings growth of 32.5% to 35%. Hershey is still generating solid free cash flow -- $2.1 billion on a trailing 12-month basis through Q2 2026. It paid out 52% of that as dividends, leaving plenty of room to sustain the payout even during a weak sales period. With improving financials, the stock's high yield looks attractive. Hershey is an iconic brand that should still be around for decades to come.

Should you buy stock in PepsiCo right now?

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Now, it's worth noting Stock Advisor's total average return is 936% — a market-crushing outperformance compared to 211% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of October 4, 2026. John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Hershey. The Motley Fool has a disclosure policy. 2 Dividend Stocks Down 12% in 2026 to Buy in October and Never Sell was originally published by The Motley Fool