- One of my favorite stock market “guru’s” is Amy Calistri. Her particular insight just jibes with me. Today she mentions a particular company that is one I know well – it has it’s manufacturing operations right here in my county! Many of my friends have ties to it. Here’s an overview of that company, inspired by her – I think you’ll like what she says about it.
The One Dividend-Payer I Want to Hold in Any Market
Okay, lets be honest: this is one of the more boring companies you’ll research. But, that is what you want if you’re looking for a stock to hold, come what may.
It may be boring, but this one pays dividends like clockwork. They’ve increased for 39 years straight — that goes back to when Nixon was in office. That even includes increases during the Great Recession. In the last ten years the quarterly dividend has risen 154%.
With this one, earnings growth isn’t going to fade out in a split second. The CEO won’t end up in jail with David Lee Roth, and it won’t invent the next generation cellphone. In other words, don’t expect much flash from this company, founded in 1872.
What you can expect is substance without hype.
So which one is it? Paper company Kimberly-Clark (NYSE: KMB)
Yeah – a paper company. They were the first to put toilet tissue on a roll. They invented the “disposable handkerchief” — the iconic Kleenex. And they were the first paper company to advertise their brands on national television. Today, you’ll many of know it’s brands as household names: Huggies, Kotex, and Depends are just a few.
‘Pretty boring stuff, right? However – and this is important – that is the sort of company that does well over time, especially when things get rocky.
Another reason I like it is that it deals with the basic needs of people… in this case ‘bodily functions’. I mean, people are going to eat and drink – they have to – which means that something’s gotta come out the back. And products that meet that need are always gonna be in demand.
Right now we’re seeing $100-plus oil, Middle East unrest, concerns about another overextended market, shaky government deficits and even Planet X, looming near. That’s a lot of worry. You might sleep better knowing a company like KMB is part of your portfolio.
Not only is it one of the most steady dividend payers around, but the shares hold up well in down markets. Take a look at the stock versus the S&P 500 in the recent bear market…
Right now the shares are yielding about 4.5%. Big deal right? Normally, that isn’t the kind of yield that’s gets me excited.
Why? Because you don’t buy this stock planning to sell it after a month, six months, or even a year. It isn’t exciting in that way. Instead, it’s the sort of holding you want to buy and forget about. Just let it pay you a steady dividend, quarter after quarter.
Now, we all know nothing in investing is never guaranteed. But over time, the dividends from this company are as likely to increase as anything. They have for forty years, after all, and that adds up.
Every share bought just five years ago has provided a 20% gain on dividends alone. You may not brag about that at parties, but in the whacky market of the past five years, that steady return… and dividend… is something to hang your hat on.
Originally inspired by Amy Calistri, Chief Investment Strategist — StreetAuthority, LLC.
IF you are interested in this sort of common sense investment approach, check out Amy’s newsletter, the “Street Authority.” It is full of insightful advice that just makes sense.
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The information contained herein are opinion and analyses based on sources believed to be reliable and are written in good faith. No representation or warranty, expressed or implied, is made. All information contained in this report should be independently verified. The administrator is not responsible for errors or omissions and receives no compensation from the companies that may be mentioned. The opinions expressed are subject to change without notice.