Procter & Gamble (NYSE: PG) is a titan of the household products industry. The company is nearly 200 years old, worth more than $200 billion, and owns well-known brand names such as Tide, Gillette, and Pampers.
But the company has struggled recently. It's sold off secondary brands like Duracell, Cover Girl, and Zest to cut costs and focus on its core brands.
Moreover, the company's once-strong pipeline of innovation has yielded little success, and spending on R&D as a percentage of sales is lower than it's been in almost any point in the last 20 years.
The Crest-maker's sales have fallen as it has shed brands, struggled to grow domestic sales, and faced a strengthening dollar. The stock is up 12% this year, but the long term looks challenging.
Here are 20 similar stocks with better prospects than P&G.
If income is your investment objective, the deck is stacked against you, as interest rates remain velcroed to record lows. But there are attractive dividend stocks out there, provided you can commit for the long run.
The Dividend Growth stocks from 5 to 50 years of consecutive dividend growth are the most popular stocks within the long-term income asset class.
I often write about stocks with a longer investment period and one basic approach is to look at the past performance of a business in order to develop future prospects of the firm.
I believe that a good past performance tells us something about the quality of the business, the market barriers, brands and consumer loyalty. It also tells us something about volume products and the art of business, the magic formula about selling a product.
Today I like to introduce some of the highest yielding stocks with cheap price mutiples from the Dividend Challengers list. Each of the stocks has increased dividends by more than 5 years in a row.
These are the best dogs from the Dividend Challengers list...
Investing in companies returning cash to shareholders via a combination of buybacks and dividends has proven to be an effective long-term strategy relative to the market and other uses of cash.
Since 1991, a sector-neutral basket of the S&P 500 stocks with the highest trailing combined dividend and buyback yields has returned an annualized 15.7% versus 13.8% for the top capex + R&D spenders and 12.8% for S&P 500. It seems this could be a great way to invest.
What is a stock purchase?
A stock repurchase occurs when a company asks stockholders to tender their shares for repurchase by the company. This is an alternate way for a company to increase value for stockholders. First, a repurchase can be used to restructure the company's capital structure without increasing the company's debt load.
Additionally, rather than a company changing its dividend policy, it can offer value to its stockholders through stock repurchases, keeping in mind that capital gains taxes are lower than taxes on dividends.
Advantages of a Stock Repurchase
Many companies initiate a share repurchase at a price level that management deems a good entry point. This point tends to be when the stock is estimated to be undervalued. If a company knows its business and relative stock price well, would it purchase its stock price at a high level? The answer is no, leading investors to believe the management perceives its stock price to be at a low level.
Unlike a cash dividend, a stock repurchase gives the decision to the investor. A stockholder can choose to tender his shares for repurchase, accept the payment and pay the taxes. With a cash dividend, a stockholder has no choice but to accept the dividend and pay the taxes.
At times, there may be a block of shares from one or more large shareholders that could come into the market, but the timing may be unknown. This problem may actually keep potential stockholders away since they may be worried about a flood of shares coming onto the market and lessening the stock's value. A stock repurchase can be quite useful in this situation.
However, let's come back to the real facts from the market. Attached you will find 10 stocks with the highest buyback yield of the past twelve months. The yield starts at 14.9% and ends at nearly 40%. Great values.
Here they are sorted by yield...
The Dividend Aristocrats are a group S&P 500 that have each paid increasing dividends for 25+ consecutive years.
We are talking a lot of the best dividend paying stocks and trying to find the best investment ideas for the years to come.
But what kind of investments worked in the past? For sure, each of the Dividend Aristocrats have shown a great performance in recent years but if you put your chips on those stocks in 2009, which of them generated the best performance, better than the overall market and better than other long-term dividend growth stocks.
I will tell you the answer in this short article.
There are currently only 50 Dividend Aristocrats. What's important about the Dividend Aristocrats is how well they have performed. Not all Dividend Aristocrats are good investments, especially in today's overvalued market. Low interest rates have pushed up real asset values, especially dividend stocks. This makes finding high quality dividend growth stocks trading at reasonable prices more difficult.
Here are 12 stocks of the S&P Dividend Aristocrats Index with more than 400% return ranked by the higehest price development since 2009.
These are the results...
Warren Buffett has 19 dividend stocks with a 2.0% or better yield in his portfolio, but which are the best? I've used a systematic approach to find the seven best -- and rank them, from "worst" to best.
Warren Buffett's investment style is a culmination of value, growth, and quality.
He looks for:
- Great business (quality)
- Trading at fair or better prices (value)
- That will compound his money far into the future (growth)
This approach leads Buffet to invest primarily in dividend stocks. Dividend stocks make up around 92% of Buffett's portfolio.
His top four holdings have an average position weighted dividend yield of 3.2% and make up 63% of his portfolio. High quality dividend growth stocks are the cornerstone of Buffett's portfolio.
Attached you will find 7 of his best dividend bets you should consider for the next years. Each of the results is a high quality stock with room to grow in the future.
Here are the results...
