As we near the half-year mark, the S&P 500 is up 9% year to date. The bull market is thriving, and the market just witnessed the largest initial public offering (IPO) ever, with Space Exploration Technology‘s $1.8 trillion market debut.
That’s a great setup for the rest of the year. There are still two more high-profile IPOs on the table, with Anthropic and OpenAI planning to go public. Many companies have reported strong performance and artificial intelligence (AI) is still driving high gains.
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However, investors shouldn’t become giddy and lose sight of the fact that the market is expensive. The more inflated it becomes, the more uncoupled it becomes (to borrow a phrase from Warren Buffett) from “the plodding performances of the businesses themselves.” Investors might think this time will be different as AI companies boast high growth and plush profits, but valuations still have to make sense.
If you’re worried about a market crash on the horizon, make sure you have some excellent dividend stocks to fortify your portfolio. Procter & Gamble (NYSE: PG) and Coca-Cola (NYSE: KO) are two great candidates.
1. Procter & Gamble
Procter & Gamble is a Dividend King, meaning the company has raised its dividend for at least 50 years, and it is one of only five companies that have raised their dividends for 70 years. That is an unparalleled track record that indicates rock-solid reliability and durability under almost any imaginable scenario, and that provides unmatched security for your portfolio.
The company owns many brands you likely use and at least recognize, including Pantene, Gillette, and Crest, that cover the gamut of household, beauty, and baby care. These are trusted names in categories that most people consider essential, providing resilience at all times.
It also means that Procter & Gamble isn’t the fastest-growing, and as a stock, it serves a different purpose for investors. The company typically reports single-digit sales increases, and when it’s a high single digit, that’s impressive. In its favor, it has built up its brand names over decades of operation, which gives it pricing power. On the other hand, shoppers might switch down when there’s pressure.
