Top 3 companies that have been paying a dividend for over 75 years
For investors, long-term dividend payments are the holy grail. Companies that can pay stable or growing dividends for decades demonstrate financial resilience, the ability to generate sustainable cash flow and loyalty to their shareholders. And today, we'll look at three that have been proving it for more than 75 years.
Black & Decker $SWK
Black & Decker is an American multinational tool and appliance company. Founded in 1910, the company currently sells its products in more than 100 countries under brands such as Black & Decker, DeWalt, Porter-Cable and others.
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Dividends play an important role in Black & Decker's strategy. It first began paying dividends in 1941 and has continuously paid dividends to its shareholders to this day. That's an incredible 82 years. Moreover, the company has continuously increased its dividend for nearly 40 years. Understandably, then, it is one of the dividend aristocrats.
Dividend aristocrats are companies that have a history of steadily and regularly increasing their dividend payout every year for at least 25 years. The term "aristocrats" is used because of the analogy with titles of nobility, which are conferred on people who have been members of noble families for many generations.
There are several criteria that companies must meet to be considered dividend aristocrats. For example, they must be part of the S&P 500 index, which includes the 500 largest U.S. companies, and have a market capitalization of at least $3 billion. These companies must also have sufficient financial stability and performance to increase their dividends regularly.
Dividend aristocrats are popular among investors looking for stable, long-term income from dividend payments. These companies typically have robust business models and strong financial backing, which allows them to increase their dividends regularly and also withstand turbulent economic conditions. Investors seeking long-term investment opportunities often include dividend aristocrats in their portfolios in order to achieve stable and regular dividend income.
The company currently pays a dividend of around 4%. Although the absolute amount of the dividend paid has varied over the years, the company has maintained a tradition of continuous payouts without interruption.
Colgate-Palmolive Company $CL+1.1%
Colgate-Palmolive Company is a New York-based multinational company that specializes in the manufacture and sale of consumer products for personal care, home cleaning and pet care. The company was founded in 1806 and today operates in more than 80 countries.
Colgate-Palmolive is known for its brands such as Colgate, Palmolive, Protex, Soupline, Ajax, Hill's, Softsoap and more. These brands are popular among customers across the globe and the company is considered as one of the major players in the consumer products market.
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When it comes to dividends, Colgate-Palmolive is a long-term dividend aristocrat. The company has been paying a regular dividend for more than 100 years and has a history of steady dividend increases going back more than 50 years. It currently pays a dividend of 2.48%.
Colgate-Palmolive's dividend history dates back to 1895, when the company first paid a dividend of 1 cent per share. Since then, the company has steadily increased its dividend to its current level. Over the past 20 years, Colgate-Palmolive has increased its dividend by an average of 7.7% per year.
Colgate-Palmolive is a popular choice among investors looking for a stable and regular dividend yield. The company has a strong financial position and stable performance, which allows it to maintain its dividend policy. Moreover, it is one of the most common choices when investors are looking for a defensive stock.
Colgate-Palmolive is generally considered a defensive stock. Defensive stocks are usually associated with industries that are resilient to economic fluctuations and have stable demand regardless of the state of the economy. Colgate-Palmolive operates in the personal care and home care consumer products industry, which are products that are generally considered essential and have stable demand regardless of economic conditions.
In addition, Colgate-Palmolive has a strong market position, with established brands that are popular and trusted by customers around the world. This allows the company to maintain stable revenues, even in times of economic recession.
Last but not least, Colgate-Palmolive is known for its, already mentioned, long-standing dividend history and stable dividend policy.
However, when watching the dividend, it is good to not only look at the dividend amount and history, but also at current events. Specifically with $CL+1.1%, we can now see a payout above 100%, which is often a warning sign. This could be for a number of reasons, but let's at least give a small summary.
A safe payout ratio is the ratio between the amount of dividends a company pays to its shareholders and the earnings the company makes. This ratio shows what percentage of profits the company pays out in dividends. A safe payout ratio is a ratio that ensures that a company has sufficient funds to finance its operating activities, invest in growth, and at the same time maintain a stable dividend yield for shareholders.
The safe payout ratio may vary depending on the industry in which a company operates and its financial condition. In general, companies in industries with high stability and regularity of earnings may have a higher payout ratio than companies in industries with greater fluctuation and performance. However, as a rough rule of thumb, a safe payout ratio is between 30 and 60 percent of a company's earnings.
A company that has too high a payout ratio may be at risk of not having enough capital to fund its operations and growth investments. This can lead to a reduction in dividends, which can negatively impact investors. On the other hand, a company with too low a payout ratio may be criticized by investors seeking a stable and regular dividend yield.
Eli Lilly $LLY-2.6%
Eli Lilly and Company is an American pharmaceutical company headquartered in Indianapolis. The company was founded in 1876 and has since specialized in researching, developing, manufacturing and selling drugs in areas such as oncology, diabetes, neuroscience and more.
Eli Lilly
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When it comes to dividends, Eli Lilly is also once again a long-term dividend aristocrat. The company has been paying a regular dividend for more than 100 years. Although it should be noted that its dividend currently stands at less than 1%, which is not staggering by any means.
Eli Lilly's dividend history dates back to 1885, when the company first paid a dividend of 25 cents per share. Since then, the company has steadily increased its dividend to its current level. Over the past 20 years, Eli Lilly has increased its dividend by an average of 4.3% per year.
Eli Lilly is a popular choice among investors looking for a stable and regular dividend yield. The company has a strong market position and performance in drug research and development. This allows it to maintain its dividend policy and increase dividends through profitability growth.
However, it should be noted that the pharmaceutical industry in general can be affected by regulations and changes in the healthcare industry, which can affect the company's performance and dividend levels. However, Eli Lilly has a strong drug portfolio and research capability, which allows it to be relatively resilient to such influences.
Disclaimer: This is in no way an investment recommendation. It is purely my summary and analysis based on data from the internet and other sources. Investing in the financial markets is risky and everyone should invest based on their own decisions. I am just an amateur sharing my opinions.
