The Procter & Gamble Company (PG), Colgate-Palmolive Company (CL) & More: In Times of Turbulence, Seek Safety With These Stocks

On occasion, the stock market reminds investors of its tendency to fluctuate wildly over short periods of time. The past couple weeks of trading has been just such an occasion, with big up and down moves that are likely testing the nerves of many market participants. In situations such as these, it’s worthwhile to seek the relative comfort of stocks that don’t send their investors on a roller coaster ride.

Companies that sell their products every day to millions of consumers will allow you to earn steady returns without having to keep your eyes glued to every market-rattling headline. Stocks such as these have been some of the best performers over long periods of time and can give you piece of mind, which in times of turbulence, becomes even more valuable.

World-class brands

The Procter & Gamble Company (NYSE:PG) directs investors’ collective attention to its 50 ‘Leadership Brands,’ the 50 products that comprise 90% of the company’s revenues and more than 90% of its profits. Twenty-five of them each generate at least $1 billion in annual sales. Its flagship brands can be found in virtually every aisle in the local grocery store. These include Gillette razors, Pampers diapers, Bounty paper towels, Tide laundry detergent, Crest toothpaste, and Head and Shoulders shampoo.

The Clorox Company (NYSE:CLX) is also a market leader among consumer staples stocks. The company sells its products in more than 100 countries, and has many household brands including its namesake bleach, Kingsford charcoal, Pine-Sol cleaner, and Glad trash bags. Nearly 90% of Clorox’s brands hold the No. 1 or No. 2 market-share positions in their categories.

Colgate-Palmolive Company (NYSE:CL) has more streamlined operations as compared to its two peers. The company is tightly focused on Oral Care, Personal Care, Home Care, and Pet Nutrition. Colgate-Palmolive Company (NYSE:CL) sells its products in over 200 countries around the world, under such internationally recognized brand names as Colgate, Palmolive, Mennen, Speed Stick, Softsoap, and Irish Spring.

Generous dividends and buybacks

The beauty of companies like these is their combination of a stable business and a commitment to rewarding shareholders. In fiscal 2012 The Procter & Gamble Company (NYSE:PG) returned $10 billion to shareholders through dividends and buybacks. Very recently, the company increased its dividend by 7% year over year. The Procter & Gamble Company (NYSE:PG) represents the gold standard of dividend-paying stocks: this year marks the 123^rd in a row of consecutive dividend payments, since the company’s incorporation in 1890. Furthermore, P&G has increased its dividend for 57 years in a row.

Like The Procter & Gamble Company (NYSE:PG), Colgate-Palmolive Company (NYSE:CL) recently provided investors with a dividend increase. The company bumped up its shareholder payout by 10%. Colgate-Palmolive has paid uninterrupted dividends on its common stock since 1895 and increased payments to common shareholders every year for 51 years.

Last May, The Clorox Company (NYSE:CLX) increased its dividend by nearly 7% and the company will likely raise its distribution again next month. Clorox has an impressive dividend track record of its own: total annual dividends paid to Clorox shareholders have increased each year since 1977.

Enjoy the fruits of slow-and-steady investing

These stocks provide reliable dividends and raise their payouts on an annual basis. Investors can purchase these stocks, sit back, and enjoy decades of accumulating an ever-increasing stream of dividends.

It’s hard to make the argument that any of these stocks are cheap, since each of them trades at a higher valuation than the S&P 500 Index. Whereas the broader market is currently valued around 18 times earnings, Clorox trades for 21 times its trailing earnings per share, and Colgate-Palmolive Company (NYSE:CL) exchanges hands for more than 23 times EPS. The Procter & Gamble Company (NYSE:PG) appears to be modestly valued, with a valuation about on par with the S&P 500.

However, it’s worth remembering Warren Buffett’s advice: It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price. Each of the stocks on this list has market-leading brands, reasonable valuations, and raises their dividends year in and year out. P&G, Colgate-Palmolive Company (NYSE:CL), and Clorox each represent wonderful companies, and their above-average P/E ratios shouldn’t deter you from buying them.

The article In Times of Turbulence, Seek Safety With These Stocks originally appeared on Fool.com and is written by Robert Ciura.

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