Three consistent dividend-yielding stocks, ideal for retirees seeking stable income.
In the world of investing, a well-rounded portfolio is key to ensuring a steady stream of income during retirement. Three companies, Procter & Gamble, ExxonMobil, and Johnson & Johnson, offer retirees a diversified foundation for dependable dividends and the potential for long-term gains. These companies span three distinct and defensive industries: consumer staples, energy, and healthcare.
Procter & Gamble (PG), a company in the consumer staples industry, boasts a stable of products like Tide, Gillette, Pampers, and Crest. Its stock price tends to fluctuate only about one-third as much as the broader market, as indicated by its beta of 0.34. The company has increased its dividend for 53 straight years, making it one of the most consistent income payers in the market with a current dividend yield of 2.7%. The payout ratio of Procter & Gamble is around 63% of earnings, indicating a balance between rewarding shareholders and reinvesting in growth.
ExxonMobil, one of the largest oil and gas companies in the world, is another cornerstone of this diversified portfolio. Its diversified global portfolio spans exploration, refining, and chemicals. ExxonMobil's volatility, as indicated by its beta of 0.50, is notably lower than many energy peers, reflecting its size and resilience. The company has maintained and even grown its dividend during downturns, demonstrating resilience in the energy sector. ExxonMobil's current dividend yield is 1.58%, and it has paid and raised its dividend for 42 consecutive years, with a current yield of 3.7%.
Johnson & Johnson (JNJ), a company in the healthcare industry, adds a third dimension to this diversified portfolio. Despite spinning off its consumer health brands to Kenvue in 2023, Johnson & Johnson remains a steady performer. Its volatility, as indicated by its beta of 0.59, is low enough to provide stability while still offering long-term growth potential. The payout ratio of Johnson & Johnson is at roughly 45%-50% of earnings, balancing shareholder rewards with reinvestment in research and development. Johnson & Johnson's current dividend yield is -0.46%, but it has raised its dividend for 62 consecutive years, with a current yield of around 3%.
Together, these companies give retirees exposure to different economic drivers, reducing the risk that one downturn derails income. Each company's modest payout ratio and low betas further reinforce the safety and growth potential of their dividends that can provide retirees with an important inflation-fighting edge.
These three companies, Procter & Gamble, ExxonMobil, and Johnson & Johnson, are classic examples of "Dividend Aristocrats" with long histories of dividend growth. They join the ranks of 3M and Coca-Cola, other companies known for increasing their dividend payments consistently for the last 50 years. For retirees seeking a dependable source of income, these companies offer a solid foundation for long-term growth and steady returns.
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