Money builds money, and while wealth cannot be built overnight, if you have the right stock picks, you can build wealth over a few years. I am a dividend investor, and I love it when I receive quarterly dividends without having to work for it. From my experience, dividend investing is all about picking dependable dividend stocks. You must not solely focus on the yields but also the stability of the business and the consistency of dividend payouts.
The seven dividend stocks listed here are reliable, stable companies and they have a record of rewarding investors. If you are building a portfolio for a worry-free future, these stocks will not disappoint. Let’s take a look at them.
Dependable Dividend Stocks: Chevron (CVX)
Oil and gas giant Chevron (NYSE:CVX) is a dividend aristocrat with a dividend yield of 4.12%. The company has increased dividends for the past 37 years.
It has a solid upstream and downstream business which ensures steady revenue even in market uncertainty. Despite the world taking small steps towards electrification, the demand for oil combustion-powered vehicles will not come to an end anytime soon.
This will continue to benefit Chevron. The company reported $5.5 billion in earnings and an impressive 12% jump in production year-over-year. The high prices of crude oil benefit Chevron, and it is a cash machine that will grow even if the prices drop.
With a yield over 4%, Chevron provides a steady income to investors in the form of cash dividends, and there is potential for a dividend hike. There will always be demand for oil and gas in the world and this means Chevron will continue to keep expanding. With the Hess (NYSE:HES) takeover, the business is only getting bigger as its resources grow.
Caterpillar (CAT)
Up 15% year-to-date, Caterpillar (NYSE:CAT) stock is exchanging hands for $339 and has generated 183% returns in the past five years. It is the largest construction equipment maker in the world and has a presence across multiple industries which ensures steady revenue growth. In the first-quarter results, the company saw a 13% YOY jump in the profit to hit $169 million, and the revenue stood at $853 million.
One reason to own the stock is the industry it operates in. The demand for construction equipment is never going to drop, and as the government focuses on the infrastructure sector, Caterpillar is set to benefit.
The company has a stellar balance sheet and enough liquidity to keep rewarding shareholders. It has a dividend yield of 1.53%, and the company has allotted $5.1 billion for dividend distributions and share buybacks in the first quarter.
Caterpillar has a history of increasing dividends for the past thirty years and has maintained the same despite the global market ups and downs. It is a highly dependable dividend stock to add to your portfolio.
Coca-Cola (KO)
Beverage giant Coca-Cola (NYSE:KO) is a dividend aristocrat that has increased its dividends for 52 consecutive years. The company has a dividend payout ratio of 79% which is better than many of the industry players right now.
Warren Buffett’s favorite stock, the company saw an 11% jump in organic sales in the first quarter and achieved a high volume growth despite inflation. The revenue came in at $11.3 billion, and the EPS stood at $0.72. While Coca-Cola stock may not rally anytime soon, it will ensure steady and consistent growth.
One of the most dependable dividend stocks, KO stock is exchanging hands for $61 today. The stock is up 3% year-to-date and has a dividend yield of 3.13%. In the recent quarter, it hiked the dividend by 5.4% to $0.485 a share.
The global giant has cracked the code of a successful business and ensures that its products are available in every part of the world through the licensing of its formula to beverage makers.
Dependable Dividend Stocks: PepsiCo (PEP)
Whether you are building a portfolio to make capital gains or to generate retirement income, all-time favorite stock pick is PepsiCo (NASDAQ:PEP). The company has a diversified business and is very stable, despite the market ups and downs. No matter where in the world you are, it is easy to find a Pepsi product, and its international sales are expanding each year.
PepsiCo is a highly profitable company with enough cash flow to keep rewarding shareholders. Trading at $170 today, the stock is moving sideways and is down 6% in the past 12 months. This is your opportunity to grab the stock. The company has increased dividends for 52 consecutive years and enjoys a yield of 3.17%.
The company saw a 2.7% jump in organic sales in the first quarter and expects a 4% rise in sales throughout the year. Its Frito Lay segment is the fastest growing and could continue to see higher sales in North America. It has managed to increase revenue through price hikes despite a fall in volumes. But a temporary volume dip is normal in any business.
Procter & Gamble (PG)
Global giant Procter & Gamble (NYSE:PG) needs no introduction. The company has raised its dividends for 68 years and enjoys a yield of 2.48%.
It has a massive umbrella of brands that are recognized globally, and it allows the company to enjoy pricing power. The company has seen the best and worst of the market and survived through it all. Investors who are tired of tech stocks might want to consider this industry stalwart.
In the third-quarter results, it reported a revenue of $20.2 billion with organic sales increasing by 3%. The diluted EPS jumped 11% to $1.52. It enjoys powerful brand recognition and has a business that will never run out of consumers. If you are looking for a safe and reliable stock that offers steady income, Procter & Gamble is your best bet.
Besides the history of rising payouts, the company has a payout ratio of over 50% which is pretty impressive. Trading at $162, the stock is up 9% YTD and 14% in the past 12 months.
Walmart (WMT)
Everyone is talking about Walmart (NYSE:WMT) stock after it reported strong quarterly earnings. Its revenue jumped 6% to $161.5 billion, and the EPS was up 22% to $0.60.
Its store sales in the U.S. increased by 5% to $108.7 billion, and e-commerce sales soared 22%. The impressive numbers have led to Walmart expecting sales in the second quarter to rise in the range of 3% to 4.5%.
The company has been making aggressive investments in the e-commerce segment and has seen them generate returns. Walmart is attracting customers by offering convenience in terms of quick delivery and free pick-up. Walmart+ has shown steady growth over the quarter, and the company announced a dividend hike of 9% recently.
The company has raised dividends for 51 consecutive years and enjoys a yield of 1.28%. Trading at $64, this is one dividend stock that can make your retirement years worry-free. It is up 22% YTD and 32% in the past 12 months.
Colgate-Palmolive (CL)
Having reported an impressive quarter, Colgate-Palmolive (NYSE:CL) is up 12% YTD and 22% in the past 12 months. The company is known for some of the most popular products including the Colgate toothpaste. No matter how the economy moves, people are going to need the essentials and this gives Colgate-Palmolive pricing power.
In the first quarter, it generated a revenue of $5.07 billion, up 6.2% YOY, and organic sales saw a 9.8% rise. The EPS came in at 86 cents, beating expectations. The higher revenue was driven by increased prices and this shows that consumers are going to continue spending on essentials even in times of inflation and price hikes. The management is aiming for revenue growth in the range of 2% to 5% this year.
CL is trading for $90 and enjoys a dividend yield of 2.20%. The company has increased payment every year for the past 60 years and this shows its commitment to rewarding shareholders. It is considered as one of the most dependable dividend stocks for a reason. This is one dividend stock that can give passive income and growth at the same time.
On the date of publication, Vandita Jadeja did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
