The biggest consumer staples companies in the United States have spent decades providing millions of consumers with high-quality products. Their efforts mean that today their products can be found in nearly every aisle of the local grocery store.
As a result, companies including Procter & Gamble (PG 0.78%), Clorox (CLX 1.80%), and Colgate-Palmolive (CL 1.04%) have cultivated millions of repeat customers, who purchase their products every day regardless of the overall economy.
The level of consumer loyalty these consumer stocks have achieved means they enjoy rock-solid business models, and profits that are all but assured. Consequently, these three stocks are great long-term buy and hold candidates.
A consumer giant with a stable of great brands
Procter & Gamble is truly a juggernaut. The company holds a massive $214 billion market capitalization, and in its last fiscal year raked in more than $84 billion in sales. P&G takes great pride in its 50 Leadership Brands, which cumulatively account for 90% of the company's products. 25 of these 50 brands generate more than $1 billion in annual sales each. Just some of the company's brands include Bounty, Pampers, Tide, Gillette, Charmin, and Crest.
Clean up with Clorox
Meanwhile, although Clorox is a much smaller industry player than P&G, with a $10 billion market capitalization, its brands are equally as impressive. Clorox recently celebrated its 100th year anniversary, and along the way it has built its own portfolio of popular products. Its core brands include its namesake bleach as well as Pine-Sol, Kingsford, Glad, and Hidden Valley. In all, nearly 90% of Clorox brands hold the number one or number two market-share positions in their respective categories.
Soap and toothpaste: a winning combination
Colgate-Palmolive is a more focused competitor than either P&G or Clorox. Whereas its two industry peers have built diversified operations in several different product areas, Colgate-Palmolive has shied away from diversifying itself to quite the extent of its competitors. Colgate-Palmolive's brands are housed in four key segments: Oral Care, Personal Care, Pet Nutrition, and Home Care.
The company's Colgate toothpaste and Palmolive soap products are its most universally recognized brands. Colgate toothpaste holds the number one market share in 146 countries across the globe. Of the company's soap products, Colgate holds the number one position in liquid hand soap and the number two position worldwide in bar soaps.
Count on rewards for decades to come
These great companies have built immensely successful brands that have served their investors extremely well over the past several decades. P&G is quite simply the gold standard of dividend-paying consumer stocks. Earlier this year it increased its dividend by 7%. This year marks the 123rd 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. Clorox recently raised its dividend by 11%, marking the 36 th consecutive year of a dividend increase. Meanwhile, Colgate-Palmolive has an enviable dividend streak for itself: the company has paid uninterrupted dividends since 1895.
Since their brands are still hugely popular and necessary to live comfortable lives, there's little reason to think that P&G, Clorox, and Colgate-Palmolive can't continue to reward shareholders handsomely for decades to come. As a result, if you're looking for great stocks to buy over the long-term, each of these companies fits the bill.
Quite simply, P&G, Clorox, and Colgate-Palmolive represent great long-term buys. Their steady performance, led by world-class brands, means the reliable returns their investors have enjoyed for decades should continue for many years to come. In an investing environment of low interest rates, the 2.5% to 3% yields available from these stocks are very attractive, and the fact that these companies raise their dividends every year is simply icing on the cake. These stocks should be bought and held for years, and can be core holdings for nearly every investor's portfolio.