The Coca-Cola Company (KO), 3M Co (MMM): The Three Best Dividend Stocks Right Now

Many of us don’t realize that 75% of sub-Saharan Africa is without electricity. The Coca-Cola Company (NYSE:KO) is doing its part to improve that statistic by bringing small solar-powered kits to kiosk owners in Kenya. Recently, the soft drink company entered into a partnership with Manchanda’s firm One Degree Solar, where The Coca-Cola Company (NYSE:KO) would market One Degree’s solar power kits to kiosk owners. These kits would give off-grid rural vendors electricity, meaning they could stay open past sunset, increase safety and visibility after dark–and sell more soft drinks in the process.

This growth initiative is something investors should pay attention to, as it has huge potential for The Coca-Cola Company (NYSE:KO) in the future. In the long-term, the management team led by Muhtar Kent is one of the best in the world, and one of the many reasons Warren Buffett believes in it.

3M Co (NYSE:MMM) is another dividend noble, and has increased its dividend for an amazing 55 consecutive years. The stock pays a dividend yield of 2.34% and recently grew its dividend by 7%. With over 50,000 products, 3M Co (NYSE:MMM) plays a role in making everything from computers to power cables and even provides health care services.

The opportunity for growth lies heavily in the health care sector, where 3M Co (NYSE:MMM) is improving penetration in the developing world. This includes Asia-Pacific and Latin America, which can add significant growth to sales and profits of 3Mover the coming years. Currently, these fast growing developing regions constitute around 20% of 3M Co (NYSE:MMM)’s consumer and healthcare segment sales, but has potential to reach anywhere from 30-40%.

3M Co (NYSE:MMM)’s payout ratio is a very healthy 38%, indicating that the company has plenty of room to increase its dividend in the future. Past performance is no guarantee of future results, but that stellar track record does point to a high chance of shareholder-friendly policies in coming years.

Foolish conclusion

Dividends are an excellent source of ancillary income for any investor, but the dividend alone should never be the primary basis for investing in a particular security. The above-mentioned companies all have excellent  growth opportunities in the near future, and are great options for long-term growth as well.

Chris Johnson has no position in any stocks mentioned. The Motley Fool recommends 3M and Coca-Cola. The Motley Fool owns shares of Philip Morris International. Chris is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

The article The 3 Best Dividend Stocks Right Now originally appeared on Fool.com is written by Chris Johnson.

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