Since Procter & Gamble (NYSE: PG) was incorporated in 1890, the National Bureau of Economic Research has counted 26 U.S. recessions. The Panic of 1893. The Great Depression. The 1970s, twice. The dot-com bust, the financial crisis, the pandemic. Through all of it, the company that makes Tide and Pampers mailed a dividend check every single quarter, and for the last 70 years each annual check has been larger than the one before. That makes this ticker a Dividend King, a designation for companies that have increased annual dividends for at least 50 consecutive years.
All of this is not a marketing line. It is the closest thing the stock market has to a promise kept. The question for anyone buying the stock today is whether a promise that old still has something behind it.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same “Total Conviction” signal is flashing for a company 1/100th the size of Nvidia. Continue »
What $10,000 in P&G stock pays today
Procter & Gamble raised its quarterly dividend to $1.0885 per share in April, a 3% increase. That works out to $4.35 a year. With the stock trading near $166, the yield is about 2.6%, so a $10,000 investment buys roughly 60 shares and produces about $265 a year in dividend income.
That is not a number that changes anyone’s life. What changes a life is what the number does over time. P&G’s dividend has risen more than 60% over the past decade, and if the next 10 years look like the last 10, that $260-ish becomes something north of $430 a year on the same shares, without buying another one. The point of owning P&G is not the yield you get today. It is the yield you get on the price you paid, 10 and 20 years from now, from a company that has never once broken the streak.
Why the track record matters more than it sounds
A 136-year dividend history is really a statement about management discipline. Every Procter & Gamble CEO since Benjamin Harrison was U.S. president has viewed the dividend as the one thing they were not allowed to touch, which forces a certain conservatism in how the company borrows, acquires, and spends. P&G’s own language in the April release says it plainly: many shareholders “rely on the steady, reliable income earned with their investment in P&G.”
That matters now, because things are getting harder. On its October earnings call, P&G said it expects roughly $1.4 billion in higher commodity, energy, and freight costs this fiscal year, and that oil above $100 a barrel would be an “increasing headwind.” Core gross margin fell 150 basis points in the quarter. This is the operating environment in which weaker consumer companies cut their payouts; Campbell’s (NASDAQ: CPB) and Flowers Foods (NYSE: FLO) both did this year.
