Dividends definitely are the next sweetest thing on this Earth, after the Super Bowl, don't you think?
Well, to be honest, a nice consistent dividend income sure stands out in this unstable economy. Most of the European region still struggles with the sovereign debt crisis issue. The big United States still scrambles under around a $1.4 trillion budget deficit. Common sense says, I should not gamble on risky options, but rather focus on dependent safe-house dividend stocks instead.
So, in this article, I have listed four "stable dividend" stocks, which you can count on - for years to come! These are the companies, which apparently:
- Have a head start over the rest of the competition,
- Produce necessary goods for consumers,
- Have a good consistent payout track record and
- Have a payout ratio always over 80%.
I call it "safe-house" stocks.
Here's the list:
Proctor & Gamble (NYSE:PG) - If there is one stock I think I can depend on in terms of dividends, it would be Proctor & Gamble. With 121 years of dividend payments and 55 years of dividend raises, the company offers the perfect dividend investment stock. The company offers 3.3% dividend, with around 60%, which is less than 80% but still comfortable.
Moreover, the company comes with 24-billion dollar brands, such as Gillette and Tide. Not only does the long-term brand popularity create the competitive edge for the company, but also the international presence plays a role in your portfolio diversification, which is great. Perhaps, that's the reason why Warren Buffett, the billionaire investor of Berkshire Hathaway (NYSE:BRK.A), invested in Gillette back in 1989, even before Proctor 7 & Gamble bought it.
Philip Morris International (NYSE:PM) - How about a smoke? Well, I have seen that many people shirk away from tobacco companies, and sometimes, this is true for the non-smokers. Who cares about smoking and health? When investing, I care only about the company's long-term investment prospects and when it comes to that, Philip Morris International (PMI) is something you would crave. After the company "spun off" from the Altria Group, arguing PMI would have more "freedom" outside the constraints of U.S. corporate ownership in terms of potential litigation and legislative restrictions to "pursue sales growth in emerging markets," PMI has carried on the legacy of offering ever increasing fat dividends to its shareholders. The company sports a 4% yield and 57% payout ratio. Not bad, eh?
With 27% market share outside the U.S. and China, and with world famous tobacco brands such as Marlboro, Long Beach and Philip Morris, this company is to be depended on.
Bemis (NYSE:BMS) - If you have ever been to a grocery store, you probably have seen the work of Bemis, which specializes in flexible packaging. The company focuses on innovation and owns around 1200 patents and applications. Don't worry about the thinning bottom-line yet, as the company has the ability to cushion its margins by transferring the material costs to the consumers. Clever, huh? Nonetheless, this has enabled the company to carry on with a track record of 29 consecutive dividend raises, currently offering a 3.2% yield and a 56% payout ratio. I would sure bet on this one.
Sysco (NYSE:SYY)- When it comes to food distribution and dividend payment together, Sysco is the best company to opt for. Sysco is the leading food service distributor in North America, and has a large distribution network to operate. This ultimately helps to spread the fixed costs, widening the margins. Not to mention the optimization of the supply chain curtails extra costs and provides a competitive advantage to the company.
This is how it currently offers 3.6% yield and 40% payout ratio, with a track record of 42 dividend payout raises.
These are the four safe-house dividend stocks that you might want to consider if you are looking for stable dividend income and long-term investment.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.