Dividend Kings on the Brink: Will These 2 Lose Their Crowns in 2026?

By Trey Thoelcke Published Mar 27, 8:50AM EDT

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Genuine Parts (GPC) paid $563.8 million in dividends against free cash flow of just $420.9 million in FY2025, creating a 134% FCF payout ratio that threatens its 70-year streak of consecutive annual increases. Stanley Black & Decker (SWK) maintains stronger coverage at 1.37x with $500.6 million in dividends supported by $687.9 million in free cash flow, though a $1.8 billion Consolidated Aerospace Manufacturing divestiture is pending to strengthen its balance sheet.
Both Dividend Kings face 2026 cash flow pressure from economic uncertainty and operational challenges, but Genuine Parts’ planned corporate separation and deteriorating cash generation create elevated dividend cut risk for the first time in seven decades.

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Dividend Kings on the Brink: Will These 2 Lose Their Crowns in 2026? — © 24/7 Wall St.

Genuine Parts (NYSE: GPC | GPC Price Prediction) and Stanley Black & Decker (NYSE: SWK) have earned Dividend King status through decades of unbroken annual increases. Genuine Parts has raised its dividend for 70 consecutive years. Stanley has maintained its streak for more than 25 years of consecutive annual increases, with the historical record extending well beyond that. But 2026 is testing both companies in ways that matter for income investors.

Genuine Parts: 70 Years at Risk

Metric	Value
Annual Dividend	$4.25/share
Dividend Yield	4.0%
Consecutive Years of Increases	70 years
Most Recent Increase	3.2% (February 2026)
Dividend King Status	Yes

The dividend now costs more than Genuine Parts generates in free cash flow. In FY2025, Genuine Parts paid $563.8 million in dividends against free cash flow of just $420.9 million, the FCF payout ratio hit 134%, up from 57% two years ago.

Metric	Value	Assessment
Earnings Payout Ratio (adjusted EPS)	$4.25 / $7.37 adjusted EPS	Elevated
FCF Payout Ratio	134%	Concerning
FCF/Dividend Coverage	0.75x	Weak

The business, distributing automotive parts under NAPA and industrial parts under Motion across 10,800+ locations in 17 countries, generated $890.8 million in operating cash flow in 2025, down from $1.25 billion in 2024. Capital expenditures consumed $469.8 million, leaving too little for the dividend. The planned separation into two independent companies adds execution risk on top of compressed cash flow.

CEO Will Stengel said on the Q4 2025 earnings call: “Creating two focused, independent companies sharpens customer and market alignment, increases clarity and speed, simplifies operations and enables disciplined, business-specific investments to unlock long-term value.” The 2026 guidance of free cash flow is projected at $550 million to $700 million, which would bring the FCF payout ratio closer to breakeven but leaves little margin.

Dividend Safety Rating: Elevated Risk. FCF coverage below 1.0x is a genuine warning. If 2026 FCF lands at the high end of guidance and the separation executes cleanly, the dividend survives. If FCF disappoints or separation costs escalate, a cut becomes a real possibility for the first time in seven decades.

Stanley Black & Decker: Cyclical Pressure, Improving Cash Flow

Metric	Value
Annual Dividend	$3.32/share
Dividend Yield	4.7%
Most Recent Quarterly Dividend	$0.83 (March 2026)
Dividend King Status	Yes

Stanley Black & Decker paid $500.6 million in dividends in 2025 against free cash flow of $687.9 million, a coverage ratio of 1.37x. Coverage was 1.77x in 2023 and has been declining. On a GAAP basis, the dividend exceeds current earnings per share of $2.65 against a $3.32 annual payout.

Metric	Value	Assessment
Earnings Payout Ratio (adjusted EPS)	$3.32 / $2.65 diluted EPS	Concerning
FCF Payout Ratio (FY2025)	$500.6M dividends / $687.9M FCF	Elevated
FCF/Dividend Coverage	1.37x	Adequate

Stanley carries $12.38 billion in total liabilities against $8.86 billion in equity, with only $280.1 million in cash. A pending $1.8 billion Consolidated Aerospace Manufacturing (CAM) divestiture should reduce debt materially. CEO Chris Nelson said on the Q4 2025 call: “We are excited about the opportunities for Stanley Black & Decker and remain committed to and confident in our ability to achieve our long-term financial objectives, even if 2026 presents another uncertain, dynamic year.” The 2026 FCF guidance of $700 million to $900 million would improve coverage meaningfully if achieved.

Stanley Dividend Safety Rating: Moderate Risk. FCF still covers the dividend, the divestiture reduces balance sheet pressure, and management guides for improved cash generation. The bear case is that volume declines deepen, tariff headwinds compress margins further, and thin cash reserves force a choice between debt service and dividend growth. The Q1 2026 FCF report will be the key signal, as that quarter has run deeply negative in each of the past three years.

About the Author Trey Thoelcke →

Trey has been an editor and author at 24/7 Wall St. for more than a decade, where he has published thousands of articles analyzing corporate earnings, dividend stocks, short interest, insider buying, private equity, and market trends. His comprehensive coverage spans the full spectrum of financial markets, from blue-chip stalwarts to emerging growth companies.

Beyond 24/7 Wall St., Trey has created and edited financial content for Benzinga and AOL's BloggingStocks, contributing additional hundreds of articles to the investment community. He previously oversaw the 24/7 Climate Insights site, managing editorial operations and content strategy, and currently oversees and creates content for My Investing News.

Trey's editorial expertise extends across multiple publishing environments. He served as production editor at Dearborn Financial Publishing and development editor at Kaplan, where he helped shape financial education materials. Earlier in his career, he worked as a writer-producer at SVE. His freelance editing portfolio includes work for prestigious clients such as Sage Publications, Rand McNally, the Institute for Supply Management, the American Library Association, Eggplant Literary Productions, and Spiegel.

Outside of financial journalism, Trey writes fiction and has been an active member of the writing community for years, overseeing a long-running critique group and moderating workshop sessions at regional conventions. He lives with his family in an old house in the Midwest.