Is Procter & Gamble one of the best dividend stocks of all time?

Procter & Gamble Company (NYSE:PG) Can be an investor’s dream. The company promotes some household names and brands, such as Pampers, Bounce, Drift, Gain, Tide, Bounty, Brown, Gillette, Old Spice, Swiffer, Dawn and dozens more.


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The growing popularity of discount retailers stocking cheap store brands has been particularly challenging. Watch the stock price for proof: P&G shares have fallen 2% over the past five years, compared to a 65% gain for the Dow.

Procter & Gamble Company History

Candlemaker William Proctor and soap maker James Gamble settled in Cincinnati, Ohio, and formed Procter & Gamble in 1837. Sales reached $1 million in 1858 to 1859 with 80 employees. In the 1880s, Procter & Gamble made ivory soap.

The company, still headquartered in Cincinnati, offered profit-sharing to its employees in 1887 and began to diversify its products in 1911, creating Crisco and eventually expanding its range into soap, toiletries and food products. brought diversity. The company continued to expand and branch out into new territories, producing Tide laundry detergent in 1946 and Preal shampoo in 1947 and fluoride toothpaste (popular Crest) in 1955. The company purchased Charmin Paper Mills in 1957 to manufacture toilet paper products, Downy Fabric. softener in 1960 and bounce fabric softener in 1972.

One of its best-selling products was the disposable Pampers brand, which later in 2018 launched Pampers Pure, a more eco-friendly alternative.

Acquisitions over time include:

  • Folgers Coffee
  • Norwich Eaton Pharmaceuticals
  • richardson-wicks
  • Knoxel
  • Shulton’s Old Spice
  • maximum truth
  • iams company
  • Pantene
  • Gillette

P&G announced it was dropping about 100 brands, and that includes selling Pringles to Kellogg’s, Ziff, Crisco and Folger to Smucker’s and Iams to Mars Inc.

Now, the company provides packaged goods to consumers around the world, streamlining its operations through six segments including beauty, grooming, health care, clothing and home care, baby, feminine and family care.

learn more: How to find out about dividend stock history

Why P&G is widely regarded as one of the best dividend stocks of all time

Why might you consider Procter & Gamble one of the best? Let’s take a look at some of the factors that rank it as the best investment ever.

  • Strong Brand Identity: Procter & Gamble’s approach to product expertise and focus on differentiation, building global research facilities, and hiring the best talent to build that brand’s following has created incredible brand recognition across decades of business.
  • Ability to continuously raise prices: This year, price hikes were applied to products such as Tide detergent and downy dryer sheets, and to various sectors such as health care, baby care, feminine care, adult incontinence, family care, home care, hair care, beauty, oral care and more. More in both the US and international markets. Growth and profitability continue to be successful as Procter & Gamble loyal consumers are willing to pay more for the brands they know and love.
  • Consistent dividend increases: dividend king The U.S. has paid dividends to shareholders since 1891, offering rewards far beyond what many companies are able to do. It has a current dividend yield of 2.55%, an annual dividend of $3.65 and a dividend payout ratio of 63.70%. As of Q3 2022, the company returned more than $3.4 billion in cash to shareholders through dividend payments of approximately $2.2 billion and common stock repurchases of $1.2 billion. P&G has the resources and willingness to increase dividends without sacrificing growth.
  • Growth and Profitability Trends: As already implied, Procter & Gamble provides excellent growth and profitability opportunities on an ongoing basis. The company reported net sales of $19.4 billion in the third quarter of fiscal year 2022, up 7% over the previous year. Organic sales increased by 10% (excluding the effects of foreign exchange, acquisitions and divestments). Diluted net income per share was $1.33, an increase of 6%. Operating cash flow for the same quarter was $3.2 billion and adjusted free cash flow productivity was 74%.
  • Ability to withstand economic pressures and market downturns: When COVID-19 arrived on the scene, it was common for investors to turn to the tried-and-true consumer staple. The consumer staples niche typically provides income protection during times of incredible volatility. If you’re focused on earnings during the nail-biting markets, Procter & Gamble offers it in spades. The company will be less sensitive to the pinball movements of most markets.

Why do you want to avoid Procter & Gamble?

On the other hand, why would you want to leave Procter & Gamble off your list?

  • competition: Despite its powerful household name and other factors that make Procter & Gamble a consistent pro-Pillar investment, it still has major competitors, including Colgate-Palmolive, Church & Dwight, and Unilever. Consumers have a variety of smaller companies available for purchase, particularly in organic personal care and other markets.
  • awesome: Procter & Gamble has a vast catalog of brands, and managing its brand portfolio, tracing a wide number of growth streams, accurately predicting consumer trends and expectations, and continuing to innovate can lead to steady growth in the future. Is.

learn more: Should You Keep Dividend Stock in Your Roth IRA?

Consider all angles before investing

If Procter & Gamble was one of only a handful of stocks you could invest in, it would be easy to say, “Yeah, I’ll take it!” However, in a field of myriad possibilities, it is always difficult to determine which way to go.

But for investors, there is light everywhere. In its 2022 Q3 financial earnings report summary, P&G increased its full-year 2022 sales forecast, reflecting rising demand for its cleaning and personal care products, despite a rise in prices.

Overall, however, P&G is a consumer and investor-oriented company. No problem, it’s a solid dividend pick, and yes, it’s one of the best dividend stocks ever.

learn more: Are Dividend Stocks Worth It?