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I bought Unilever (NYSE:UL) this morning and there are several key reasons why it will be important to my core portfolio going forward. I did make my purchase at $38.38, but I'm not here to speculate on the stock price over the short term. I bought half of my target position on the hopes that the stock price continues to fall. That being said, let's take a look at Unilever the company.

Unilever markets and sells a host of brands including Axe deodorant, Ben & Jerry's ice cream, St. Ives Lotions, Dove soap, Lipton teas, and Bertolli pastas. At first glance, the company looks expensive, currently selling with a price-to-earnings (P/E) ratio of around 17 and a price-to-book (P/B) ratio of about 6.0. On the surface these metrics look high to a value investor like me, although less expensive than some of their competitors. What you get with Unilever however is growth and market share throughout the world. According to Unilever's website, their products are sold in 190 countries around the world. More importantly, they also claim that emerging markets accounted for 55% of their business sales. Emerging markets are important to me, because they are where the population growth will come from in the future. As billions of new consumers emerge in the coming decades, companies need to be well positioned to sell to those consumers. I believe Unilever is positioned to sell to these new consumers.

As a US investor, this is the type of diversification I want. I also own General Mills (NYSE:GIS) and Procter & Gamble (NYSE:PG), but Unilever is serving different geographic customers by having more exposure to Africa and the Middle East in particular. Additionally, Unilever has been able to maintain reasonable growth and expand their margins. 2013 FY saw increased competition in developed markets (like the US and Europe) but increased growth in emerging markets. In fact, in their Q4-2013 earnings presentation, they said that their core operating margin expanded by 40 bps while emerging markets volume grew by 8.7%.

Being a long-term investor, I always look at the historical return on equity (ROE) metrics. Unilever has recorded ROE figures ranging from 27.9 to 45.0 over the last 10 years. Those are some solid numbers and the current 3.8% dividend is a nice payout along the way. Unilever's operating margins have ranged from 12.6 to 17.7 since 2005. Not too shabby when you consider that the global financial crisis took place during that time. They didn't need to cut prices (and therefore margins) in order to maintain sales.

As I mentioned before I am a long-term investor and I intend to own Unilever for the duration. Therefore, it makes me smile that the company thinks enough of its shareholders to more than triple the dividend (from $0.43 to $1.42) over the past 10 years. I'm not banking on Unilever tripling their dividend again in the next 10 years, but there is room for reasonable dividend growth given the company's revenue and earnings growth.

Finally, I like to look at historical valuations on the companies I invest in. According to Morningstar.com Unilever's current P/E is below the 5-year average P/E (17 vs. 18), its price-to-sales ratio is the same as the 5-year average (1.6). Unilever's current price to free cash flow is slightly below its 5-year average as well (13.1 vs. 13.3).

Conclusion

If you wrap it all up, Unilever is offering solid (and geographically diversified growth) at a reasonable price. If the current stock market sell off turns out to be the start of a much larger market sell off, I will continue to buy Unilever's stock and average down my cost basis. I don't like to guess what global stock markets will do in the short run. I like to find the stocks of companies I want to own for a long time, and buy them when they hit my buy level. This morning Unilever's stock price hit my buy level and I initiated a position. It looks like a stock I will buy more of, and pass on to my children.

Disclaimer: This analysis is for informational purposes only and should not be considered a recommendation to buy, sell, or hold any equities. I am not a financial professional. The information above is provided by Yahoo Finance and Unilever's website.

Source: Why I Bought Unilever This Morning