One particularly wise piece of investing advice is to buy what you know. In other words, investors who don’t have either the time or the patience to devote hours and hours of their valuable time to portfolio management, can do themselves a huge favor by focusing on stocks they already know a lot about.
To that end, it’s extremely likely that you’ve come across these companies and their brands many times. The products these companies offer can be found in virtually every grocery store across America, and you don’t need to be a financial whiz to understand their businesses.
Keep it simple
You can take steps to ensure your financial future by owning stocks that pay dividends every quarter like clockwork and raise their dividends every year, allowing their shareholders to build wealth over time due to the magic of compound interest.
General Mills, Inc. (NYSE:GIS) offers a diversified portfolio of food products, including Cheerios, Cinnamon Toast Crunch, and Wheaties, not to mention a stable of other food items. The company grew astoundingly from very humble beginnings: its first product was Gold Medal flour, introduced all the way back in 1880.
General Mills, Inc. (NYSE:GIS) is the gold standard for dividend payers. In early March, General Mills, Inc. (NYSE:GIS) raised its dividend 15% to its current level of $1.52 per share annualized. The company has paid uninterrupted dividends for an astounding 114 years in a row, and provides new investors with a solid 3% yield at recent prices.
B&G Foods, Inc. (NYSE:BGS) manufactures and distributes shelf-stable foods and household products, and has a stable of brands including Ortega, Cream of Wheat, and Mrs. Dash. B&G Foods, Inc. (NYSE:BGS) has only been public since 2004, but has paid its investors a dividend every quarter since then.
B&G Foods, Inc. (NYSE:BGS) last raised its dividend in late 2012, providing investors with a 7.4% dividend increase to its current level of $1.16 annualized. At recent prices, the company’s payout amounts to a nearly 4% yield, which looks especially attractive considering the yield on the broader market, as measured by the S&P 500 Index, stands at only 2%.
ConAgra Foods, Inc. (NYSE:CAG) has a market value of $14 billion and creates many household brands, including Healthy Choice, Hebrew National, and Del Monte. ConAgra Foods, Inc. (NYSE:CAG)’s consumer brands can be found in 97% of America’s households, and 28 of them are ranked first or second in their category.
ConAgra Foods, Inc. (NYSE:CAG) increased net sales by 8% in fiscal 2012, and rewarded its shareholders by raising the dividend by 4% last year. ConAgra Foods, Inc. (NYSE:CAG)’s $1 per share dividend represents a nearly 3% yield for new investors.
Great brands you already know well
Although consumer staples and food companies don’t get much attention from the financial media, the truth is that some of the best stocks over long periods of time have come from these industries, and it’s not hard to see why.
Companies with recession-resistant businesses, whose products are piled into the grocery carts of millions of consumers every day regardless of the prevailing economic climate. In turn, these companies reward their shareholders with reliable dividends that are increased on a regular basis.
Whereas the financial media obsesses over the hot stocks of the day, touting the next technology start-up that promises to change the world and mint instant millionaires overnight, the reality is that for most retail investors, slow-and-steady is the best way to long-term prosperity. If that sounds appealing to you, the stocks in this article might be perfect for you.
The article These Stocks Belong in Your Shopping Cart originally appeared on Fool.com.
Robert Ciura has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Robert is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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