Companies that have raised their payouts for 50 consecutive years or more are known as Dividend Kings — and two of them are currently telling very different stories. Lowe’s (NYSE: LOW) is down about 23% year to date and trading near a 52-week low, while Black Hills (NYSE: BKH) has been climbing after signing a major data center power deal with Google. For investors, the question is how to choose between a falling Dividend King and a rising one.
Lowe’s shares are down about 23% this year, hovering near a 52-week low of $186, and have fallen roughly 15% since the company reported second-quarter earnings on Aug. 19. The sell-off, however, has pushed its price-to-earnings ratio down to 16 — the lowest level in three years — for a company that has raised its dividend for 55 consecutive years.
The backdrop is a difficult macro environment. High mortgage rates and inflation are prompting consumers to hold off on home purchases and non-essential spending, weighing on home improvement demand. In the second quarter, revenue rose 8% year over year to $26 billion, but same-store sales were essentially flat; growth came from new store openings and acquisitions aimed at the commercial business serving contractors, while earnings were flat due to acquisition-related costs. The company subsequently trimmed its full-year guidance for sales, same-store sales, operating income and earnings per share to the lower end of its previous ranges, reflecting slower growth in the first half and expectations for the second.
The bull case rests on valuation and the cycle. Lowe’s is trading at its cheapest level in three years, and housing is a cyclical business: if mortgage rates stabilize and begin to decline — possibly next year — pent-up demand should emerge, leaving Lowe’s and rival Home Depot well positioned to capture it. The dividend looks secure as well: operating cash flow totaled $7.1 billion through the second quarter against roughly $1.1 billion in capital expenditures, leaving about $6 billion in free cash flow and a payout ratio of 38%. Wall Street largely agrees, with 72% of analysts rating the stock a buy and a median price target of $254, implying upside of about 36%.
Black Hills is a regulated utility with 56 consecutive years of dividend increases and a yield of roughly 3.6%. Utilities have historically been a sleepy corner of the market, prized for low volatility and stable cash flows — but lately they have been grabbing headlines through long-term agreements with big technology companies, and Black Hills is among them.
On Oct. 6, the company announced a series of agreements with Alphabet’s Google to provide energy infrastructure and services for a hyperscale data center campus in Cheyenne, Wyoming, through 2048. Under the deal, Black Hills will deliver 2.7 gigawatts of power, including 590 megawatts of grid-connected service and 2.1 gigawatts of privately managed, third-party-contracted resources operating as an off-grid microgrid. Energy services are expected to begin in late 2027 and ramp to peak load by 2030; the company projects the agreements to add $150 million in annual net income and $2.4 billion in unlevered free cash flow through 2048. To deliver on that, Black Hills plans to invest $1.8 billion in capital expenditures between 2027 and 2029 to build 564 megawatts of natural gas generation, while Google has provided $399 million in refundable advances that Black Hills intends to repay next year.
Regional demand underpins the deal. Cheyenne is emerging as a data center hub thanks to favorable regulatory policies, a cool climate and substantial grid investment: Wyoming Electric’s system peak load hit a record 439 megawatts in July 2026, up 16% from 2025, and Microsoft has partnered in Cheyenne for more than a decade, with a Meta data center expected to come online in 2027. For Black Hills, the $150 million annual net income addition is significant relative to its $292 million in net income for 2025.
The two Dividend Kings represent two very different investment theses. Lowe’s is a bet on a cyclical trough and valuation recovery, with the risk that high mortgage rates, a lowered outlook and a sluggish tape keep the stock under pressure in the near term. Black Hills is a bet on surging power demand from AI data centers, but its payoff is not expected until after 2027 and comes with an $1.8 billion capital commitment. Whether the better buy is the one that has fallen into a margin of safety or the one that has grown into a growth narrative ultimately depends on how investors weigh the timing of a housing cycle turnaround against the pace of delivery on a data center boom.
