Dividends represent a great return on your investment as they offer a tangible return that is unrelated to the stock's price. With a portfolio of dividend stocks, you can build up a steady and consistent stream of passive income to supplement your earned income. However, it is not enough to just select companies that pay out a dividend. You need to ensure that the business can be relied on to keep paying out dividends and for these dividends to steadily increase to beat inflation.

What investors should be looking for are "safe" dividend stocks -- companies that have a stellar track record of increasing dividends, own a portfolio of solid brands and products, and generate copious amounts of free cash flow. Granted, these businesses may still be affected by the ups and downs of the economic cycle, making their share prices unavoidably volatile. But if you are an income investor who is purely focused on dividends, then these three storied names are as dependable as they come.

Mop and cleaning fluids.

Image source: Getty Images.

1. Procter & Gamble

Procter & Gamble (PG 1.27%), the $360 billion consumer goods behemoth, boasts a wide portfolio of hair care, personal care, and oral care products under major brands such as Head & Shoulders, Gillette, Olay, Oral-B, Pampers, and Braun. The company has reported a steady rise in both revenue and net profit since its fiscal 2017, with sales going from $65.1 billion to $80.2 billion over the six years to fiscal 2022. Net income from continuing operations climbed from $10.2 billion to $14.7 billion over the same period. Crucially, every single one of those fiscal years saw Procter & Gamble generate positive free cash flow. 

This consistency in free cash flow generation allowed the company to pay out a dividend for an impressive 133 consecutive years, and its dividend has also increased without a pause for 67 consecutive years. Judging from Procter & Gamble's latest fiscal 2023 third-quarter earnings, this track record looks set to continue. For the first nine months of fiscal 2023, sales inched up 1.3% year over year to $61.5 billion, but net income slipped by 3.6% year over year to $11.3 billion because of higher expenses. Free cash flow clocked in at a positive $9.2 billion, although this was 13% lower than the prior year's $10.5 billion. With Procter & Gamble's dividend payout ratio at 62%, along with healthy free-cash-flow generation, the company more than deserves its place as a safe dividend stock.

2. Kimberly-Clark

Kimberly-Clark (KMB 0.84%) is well known for its widespread brands and products encompassing adult care, feminine care, and baby care. With its products being sold in 175 countries around the world, you will probably recognize household names such as Huggies, Kleenex, Cottonelle, and Kotex. Like Procter & Gamble, Kimberly-Clark saw its revenue increase from $18.3 billion in 2017 to $20.2 billion in 2022. Net income, however, fluctuated over these six years between a high of $2.4 billion and a low of $1.4 billion. What was remarkably consistent, though, was the company's free cash flow generation over the years, which averaged close to $2 billion from 2017 to 2022. 

The first quarter of 2023 saw Kimberly-Clark report a 2% year-over-year increase in sales to $5.2 billion, while net income rose 8% year over year to $566 million. A positive free cash flow of $412 million was reported, reversing the free cash outflow in the prior year's first quarter. A quarterly dividend of $1.18 per share was also declared, representing 70% of the company's earnings for Q1 2023. It was the 51st consecutive year that Kimberly-Clark had raised its dividend, putting it firmly into the list of Dividend Kings, and was also the 89th straight year that the company has paid out a dividend to shareholders. With a plethora of strong brands, pricing power, and customer loyalty, Kimberly-Clark is well positioned to continue paying out ever-rising dividends into the future.

3. Clorox

Clorox (CLX 1.42%) is one the leading detergent and cleaning liquids companies with a variety of recognizable brands such as Brita, Clorox, Pine-Sol, and Glad. Clorox reported steadily increasing sales from 2017 to 2022, going from $6 billion to $7.1 billion. Net income, however, fluctuated significantly because of a higher cost of goods sold and the impairment of goodwill in certain years. Despite the volatility, the cleaning products company still posted positive free cash flow in all six years, with an average positive free cash flow of $829 million per year. 

This solid track record of free cash flow generation has enabled Clorox to raise its annual dividends continuously over at least 37 years from 1986 to the present. For the first nine months of fiscal 2023, ending March 31, Clorox once again generated a positive free cash flow of $584 million, more than double the $279 million generated a year ago. Clorox's IGNITE strategy is in place to maximize growth and make a positive impact on the world. The company will leverage technology for cost savings, tap into innovation to improve customer experience, and evolve its portfolio of products to enhance wellness and personal care. With this strategy in place and the company's impressive track record of rising dividends, Clorox should be included as another dependable dividend stock to include in your investment portfolio.