Investors have always been interested in stocks that pay dividends, but lately, low interest rates on bonds and other fixed-income investments have made solid dividend payers even more valuable. Among the most promising dividend stocks in the market is Colgate-Palmolive Company (NYSE:CL) , and one big reason is that it is one of the few exclusive companies to make the list of Dividend Aristocrats. In order to become a member of this elite group, a company must have raised its dividend payouts to shareholders every single year for at least a quarter-century. Only a few dozen stocks manage to make the cut, and those that do tend to stay there for a long time.
Colgate-Palmolive Company (NYSE:CL) is well-known for its impressive stable of consumer products. Doing business around the world, the company has delivered not only solid dividends for decades, but also the growth prospects that investors always like to see in a stock. Let’s take a closer look at Colgate-Palmolive Company (NYSE:CL) to see whether it can sustain its long streak of rewarding dividend payouts to investors.
Dividend Stats on Colgate-Palmolive
| Current Quarterly Dividend Per Share | $0.68* |
| Current Yield | 2.3% |
| Number of Consecutive Years With Dividend Increases | 50 years |
| Payout Ratio | 47% |
| Last Increase | April 2013* |
Source: Yahoo! Finance. Last increase refers to ex-dividend date. * Declared but not yet paid.
How has Colgate-Palmolive been treating shareholders lately?
As one of the best companies in America, Colgate-Palmolive Company (NYSE:CL) has come from modest roots as a soap and toothpaste maker to become a global consumer-goods powerhouse. Even given the defensive nature of the sector, Colgate-Palmolive Company (NYSE:CL)’s stock has performed extremely well, soaring to new all-time highs, and climbing more than 50% since early 2011.
Colgate-Palmolive Company (NYSE:CL)’s overall growth strategy is largely behind the successful performance of its stock, as the company has tied its success to that of international markets across the globe. With a particular emphasis on Latin America, Colgate has prospered with strong financial results. By contrast, The Procter & Gamble Company (NYSE:PG), the giant in the sector, has had trouble keeping its growth up in light of difficulties with product innovation, and a slowdown in its international growth. That has opened the door for Colgate to take a bigger role in the industry.
Yet, companies with strong track records of raising dividends for decades have generally had to overcome challenges along the way. Like many of its consumer-products peers, Colgate has had to face rising costs for some of the materials it needs to produce its goods. In order to keep its margins up, Colgate announced layoffs last fall amounting to about 6% of its workforce around the world. Despite those pressures, Colgate-Palmolive has managed to keep its payouts strong:
