2. Colgate-Palmolive Company (NYSE:CL)
Number of Hedge Fund Holders: 50
Dividend Yield as of July 23: 2.05%
An American multinational consumer products company, Colgate-Palmolive Company (NYSE:CL) ranks second on our list of the best dividend stocks of all time. The company has always been testing new business approaches, which have contributed to its status as a global leader in consumer products. Originally starting as a small soap and candle business, it has now diversified into a broad range of products. For Colgate-Palmolive Company (NYSE:CL), recent strategic shifts, such as focusing on e-commerce, are showing positive results. Although this progress is partially reflected in the company’s valuation, these strategic changes are expected to lead to consistently higher organic sales growth for CL compared to its competitors over the long term.
Colgate-Palmolive Company (NYSE:CL) qualifies as one of the best dividend stocks of all time because of its strong cash generation. In its recently announced second-quarter earnings, the company reported an operating cash flow of over $1.6 billion, up from $1.45 billion in the prior-year period. Its free cash flow before dividends came in at $1.4 billion, growing from $1.11 billion in the same period last year. During the quarter, it returned $867 million to shareholders through dividends. The company’s quarterly earnings are well-received by Street analysts and investors. In the second quarter, the stock gained nearly 9% and its year-to-date returns are even more impressive at roughly 20%.
ClearBridge Investments highlighted reasons for Colgate-Palmolive Company (NYSE:CL)’s outperformance in its Q2 2024 investor letter. Here is what the firm has to say:
“Colgate-Palmolive Company (NYSE:CL), added to the portfolio in 2023, started outperforming materially toward the tail end of last year as growth, margin and market share momentum began to turn favorably, and that momentum has continued year to date as the stock has nicely outperformed the large cap staples group. The fundamental upside has been driven by a combination of healthy organic growth (with positive volumes), good gross margin progression, and strong re-investment spending supporting market share gains and future growth.”
On June 13, Colgate-Palmolive Company (NYSE:CL) announced a quarterly dividend of $0.50 per share, which was in line with its previous dividend. The company holds a 62-year streak of consistent dividend growth and has paid dividends without interruption for 129 years in a row. The stock’s dividend yield on July 23 came in at 2.05%.
Of the 920 hedge funds tracked by Insider Monkey at the end of Q1 2024, 50 funds had invested in Colgate-Palmolive Company (NYSE:CL), down from 54 in the previous quarter. The stakes held by these hedge funds have a collective value of over $2.1 billion.
