Procter & Gamble Co (PG): Dividend Analysis
It’s close to the middle of the month and the market has still been extremely volatile. With that, I know that opportunities are out there, wonderful opportunities, especially dividend stocks that are aristocrats. Yields are looking fairly unusually high for a few of the aristocrats that do not historically have them at these levels. This makes us all extremely motivated and excited investors as our dividends are reinvested at better valuations and also opens up the table for buying potential! With that, we will analyze one of the dividend aristocrats in Procter & Gamble Co (NYSE:PG).
Procter & Gamble – Tide, Dawn, Gillette, Bounty, Luvs, Mr Clean, Cascade, Charmin… the list truly goes on, as we have seen when we analyze companies (such as Disney). It’s phenomenal the products that they offer and how the every-day consumer will more than likely purchase these products – and in abundance, as well as throughout the year aka recurring customers and revenue. Further, PG has increased dividends for over 61 years. That is why I still will consider them as a foundation stock for a dividend growth investor and their portfolio. I did much more digging on PG’s dividend history, say 25 years worth and here is the chart:
25 years worth of dividend growth data and yes the average dividend growth rate for the last 25 years stands at 10%; with the last 4 years coming in at 7% or less. They have recently begun cleaning their portfolio a bit to become more focused, as evidenced by their recent agreement to sell their beauty products line to Coty. I believe that moves like these will increase margins to bring the growth to the dividend back to the historical record they have had in the 7-10% range.
I like Procter & Gamble. I like what they are doing with the company and how it pairs well with my recent purchase into JNJ, another aristocrat and foundation stock. Further, I currently only receive (at this time) $13/quarter in dividend income from PG – as you have seen in my August Dividend Income post and I would actually like to almost double that investment, at least enough to pick up a whole share during the year with reinvestment. The markets are taking a downturn consistently, and it may be time to gather the army of capital to deploy here soon. Within the next upcoming weeks, if PG stays below the $69 mark, I just may pull the trigger and pick up new shares of PG. I’ll have to get my capital ready and I’m excited to see if I can add more of this aristocrat stock to my current portfolio, which would help push me closer to my goals.
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