We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Colgate-Palmolive (CL) is a Great Dividend Stock Right Now
Read MoreHide Full Article
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Colgate-Palmolive in Focus
Headquartered in New York, Colgate-Palmolive (CL - Free Report) is a Consumer Staples stock that has seen a price change of 21.74% so far this year. The consumer products maker is paying out a dividend of $0.5 per share at the moment, with a dividend yield of 2.06% compared to the Soap and Cleaning Materials industry's yield of 2.44% and the S&P 500's yield of 1.6%.
In terms of dividend growth, the company's current annualized dividend of $2 is up 4.7% from last year. Over the last 5 years, Colgate-Palmolive has increased its dividend 5 times on a year-over-year basis for an average annual increase of 3.02%. Future dividend growth will depend on earnings growth as well as payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Right now, Colgate-Palmolive's payout ratio is 57%, which means it paid out 57% of its trailing 12-month EPS as dividend.
CL is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2024 is $3.53 per share, representing a year-over-year earnings growth rate of 9.29%.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. But, not every company offers a quarterly payout.
High-growth firms or tech start-ups, for example, rarely provide their shareholders a dividend, while larger, more established companies that have more secure profits are often seen as the best dividend options. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, CL presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Colgate-Palmolive (CL) is a Great Dividend Stock Right Now
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Colgate-Palmolive in Focus
Headquartered in New York, Colgate-Palmolive (CL - Free Report) is a Consumer Staples stock that has seen a price change of 21.74% so far this year. The consumer products maker is paying out a dividend of $0.5 per share at the moment, with a dividend yield of 2.06% compared to the Soap and Cleaning Materials industry's yield of 2.44% and the S&P 500's yield of 1.6%.
In terms of dividend growth, the company's current annualized dividend of $2 is up 4.7% from last year. Over the last 5 years, Colgate-Palmolive has increased its dividend 5 times on a year-over-year basis for an average annual increase of 3.02%. Future dividend growth will depend on earnings growth as well as payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Right now, Colgate-Palmolive's payout ratio is 57%, which means it paid out 57% of its trailing 12-month EPS as dividend.
CL is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2024 is $3.53 per share, representing a year-over-year earnings growth rate of 9.29%.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. But, not every company offers a quarterly payout.
High-growth firms or tech start-ups, for example, rarely provide their shareholders a dividend, while larger, more established companies that have more secure profits are often seen as the best dividend options. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, CL presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).