Colgate-Palmolive Hikes Quarterly Dividend Payout 5% for 55th Consecutive Annual Dividend Increase (CL)
By: Ned Piplovic,
Featured image source: www.colgatecommercial.com; All brands and logos are registered trademarks of the The Colgate-Palmolive Company
The Colgate-Palmolive Company (NYSE:CL) offers a 2.4% dividend yield and the company continued its long streak of rising annual dividends by rewarding its shareholder with a quarterly dividend boost of more than 10%.
This period’s dividend enhancement raises the company’s streak of annual dividend hikes to 55 consecutive years. With such a long record of annual dividend hikes, the Colgate-Palmolive Company is one of only 51 companies that are currently designated Dividend Aristocrats.
The Dividend Aristocrats designation describes S&P 500 companies with a market capitalization of at least $3 billion that have managed to boost annual dividends for at least 25 consecutive years. Because Colgate-Palmolive’s rising dividend record exceeds 50 consecutive years, the company also qualifies for inclusion in an even more exclusive group of only 11 companies designated as dividend kings.
Colgate-Palmolive’s share price has been rising reliably for decades to accompany the company’s increasing dividend income. However, the share price ended slightly lower at the end of the trailing 12-month period than where it started.
Investors confident that the share price could return to its long-term rising trends may want to add Colgate-Palmolive shares prior to the company’s next ex-dividend date on April 12, 2018, to guarantee that they will receive dividend distributions on the next pay date of May 15, 2018.
Colgate-Palmolive Company. (NYSE:CL)
Founded in 1806 and headquartered in New York City, the Colgate-Palmolive Company manufactures and sells consumer products worldwide. The company operates through business segments, Oral, Personal and Home Care, and Pet Nutrition. The company offers oral care products, including toothpastes, toothbrushes, and mouthwashes, as well as pharmaceutical products for dentists and other oral health professionals. Additionally, the company develops and manufactures personal care products that include bar and liquid hand soaps, shower gels, shampoos, conditioners, deodorants and antiperspirants. The home care segment of the company’s product portfolio includes laundry and dishwashing detergents, fabric conditioners, household cleaners, bleaches and other related products. Additionally, the company’s Pet Nutrition segment provides pet products for everyday nutritional needs, a range of therapeutic products to manage disease conditions and various products with natural ingredients.
The business unit also markets and sells its pet nutrition products for dogs and cats through pet supply retailers and veterinarians. The company markets and distributes its product under many well-known, household brands and trademarks, which include Colgate, Palmolive, Speed Stick, Lady Speed Stick, Softsoap, Irish Spring, Protex, Tom’s of Maine, Sanex, Ajax, Soupline and Suavitel, as well as Hill’s Science Diet, Hill’s Prescription Diet and Hill’s Ideal Balance.
The company’s share price began the current trailing 12 months with a rise of nearly 5% over the first 60 days before embarking on several up-and-down cycles over the subsequent 10 months. The last trend direction change in 2017 occurred at the end of October, when the share price embarked on an uptrend over the following 75 days and gained 12% to reach its 52-week high of $77.50 by January 09, 2018. At that point the share price was trending 5.1% above the $73.77 price level from March 28, 2017.
Unfortunately, the company’s share price got caught up in the overall market selloff, declined more than 12% in just two weeks and, after experiencing some volatility through February and most of March 2018, reached its 52-week low of $68.19 on March 26, 2018. The share price rose slightly and closed on March 27, 2018, at 69.28. This closing price was still more than 10% short of its mid-January peak, continued at the end of January and 6% lower than it was one year earlier.
While the share price had an uncharacteristically off year, the company’s dividend payouts continued to provide steady dividend income to shareholders. The company boosted its quarterly payout 5% from the previous period’s $0.40 amount to the current $0.42 quarterly payout. This current payout is equivalent to a $1.68 annualized payout for 2018 and yields 2.4%, which is 10.2% above company’s own average yield over the past five years. Additionally, the company’s current yield is 29% higher than the 1.88 average yield of the entire Consumer Goods sector and 25% above the 1.94% average yield of all the companies in the Personal Products market segment.
The company has been paying dividends since 1895 and has increased its annual dividend amount every year since 1963. Just over the past two decades, the company grew its annual dividend payout at an average rate of 11.1% per year, which enhanced the total annual dividend amount more than eight-fold from the $0.206 total payout in 1998 and its current $1.68 distribution.
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