The Best 2 Consumer Staples Stocks to Buy and Hold for Decades

Consumer staples companies sell products that get bought in good times and bad. That’s why they are considered safe-haven investments during times of uncertainty. Given the economic concerns among consumers and the unfolding geopolitical conflict in the Middle East, now could be a good time to err on the side of caution. Which is why stocks like Coca-Cola (KO +0.28%) and Procter & Gamble (PG +0.03%) could be perfect fits for your portfolio.

Consumer staples and Dividend Kings

Coca-Cola is the world’s largest non-alcoholic beverage maker, with iconic brands that stretch well beyond its namesake Coke. Procter & Gamble is also one of the world’s largest consumer staples companies, with a portfolio of brands that range from toilet paper to toothpaste. But there’s something even more interesting that links these two companies. They are both Dividend Kings.

Image source: Getty Images.

Reaching the elite status of Dividend King requires a company to increase its dividend annually for at least 50 consecutive years. A company can only do that if it has a strong business plan that gets executed well in both good times and bad. It also shows that a company places a high value on returning value to shareholders over time via dividend payments.

Both Coca-Cola and Procter & Gamble have proven they are resilient businesses. And right now, Coca-Cola is offering a dividend yield of 2.6% while P&G is yielding 2.8%. For comparison, the S&P 500 index (^GSPC 0.61%) is yielding only 1.1% or so.

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NYSE: KO

Coca-Cola

Today’s Change

(0.28%) $0.22

Current Price

$77.30

Key Data Points

Market Cap

$334B

Day’s Range

$77.19 - $78.05

52wk Range

$65.35 - $82.00

Volume

470K

Avg Vol

18M

Gross Margin

61.75%

Dividend Yield

2.63%

Coca-Cola and P&G are reasonably priced

Industry-leading businesses like Coca-Cola and Procter & Gamble don’t go on sale very often. But even a fair price is likely to be a good entry point if your holding period is a decade or longer. P&G’s price-to-sale, price-to-earnings, and price-to-book ratios are all below their five year averages. Coca-Cola’s P/E and P/B ratios are below their long-term averages, while the P/S ratio is just slightly higher. Thus, they both appear at least reasonably priced, if not a little cheap.

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NYSE: PG

Procter & Gamble

Today’s Change

(0.03%) $0.05

Current Price

$150.55

Key Data Points

Market Cap

$350B

Day’s Range

$150.19 - $152.50

52wk Range

$137.62 - $174.80

Volume

342K

Avg Vol

11M

Gross Margin

51.11%

Dividend Yield

2.81%

The big story here, however, is that you want to focus on both quality and price when your holding period is measured in decades. And right now, Coca-Cola and Procter & Gamble appear to be offering a massive amount of quality for the price, with well above market dividend yields thrown in for good measure.

If you are worried about the market, the economy, or geopolitical tensions, now could be the perfect time to add consumer staples Dividend Kings Coca-Cola and Procter & Gamble to your dividend portfolio.