Tuesday, July 20th, 2010
Three Defensive Dividend Stocks for Retirees
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Philip Morris International Inc. (NYSE:PM), Colgate-Palmolive Company (NYSE:CL) and Marathon Oil Corporation (NYSE:MRO) are three defensive dividend stocks for retirement portfolios.
The U.S. recovery has stalled and economic indicators are pointing downwards, but investors selling out of the market now are doing so at a low. Investors that are adverse to risk and looking for relatively safe bets that pay a healthy dividend may want to check out these three defensive dividend stocks…
Philip Morris Isn’t Going Up in Smoke
Philip Morris International Inc. (PM, Free Analysis) is a very diversified cigarette company that sells to approximately 160 different countries and pays a healthy 4.64% dividend yield. Despite an adverse regulatory environment for smoking in the U.S., tobacco is still very much alive in emerging markets like Asia and South America, making this company a relatively safe and diversified play.
Last quarter, the cigarette company reported a 0.7% increase in volumes due primarily to gains in Asia and Latin America that offset declines in the European Union caused by adverse tax laws. Meanwhile, net revenues increased 17.3% and net income jumped 15.4% due to favorable currency changes, net prices increases and acquisitions that helped boost the top and bottom line.
Click Here: Get a Full PM Stock Analysis!
Colgate-Palmolive Provides the Basics
Colgate-Palmolive Company (CL, Free Analysis) provides toothpaste and other consumer goods that are the staples of society and pays a healthy 2.55% dividend yield. While people may be cutting back on their spending, it is unlikely that they will cut back on the necessities provided by this company, making it a relatively safe and diversified play that pays a nice dividend.
Last quarter, the consumer products company reported net sales that increased 9.5% due to favorable currency changes, steady selling prices, and growth in Latin America and Europe. However, net income fell from $0.97 per share to $0.69 per share year-over-year due to a one-time charge related to hyperinflationary accounting in Venezuela – excluding that it was up 25% to $1.21 per share.
Click Here: Get a Full CL Stock Analysis!
Marathon Oil Plays Both Ends of the Industry
Marathon Oil Corporation (MRO, Free Analysis) is a fully-integrated oil company that handles everything from taking it out of the ground to refining it into gasoline and pays a healthy 3.17% dividend yield. While many oil companies are either exposed to the commodity or gas prices, this diversified company can benefit from either lower or higher prices with feet in both ends of the supply chain.
Last quarter, the oil company reported net income that increased 62% due to higher oil prices and the gain on the sale of 20% of one of its oil properties, Angola Block 32. Meanwhile, refining revenues decreased due to lower margins along with a derivative loss. But, as previously noted, this is the hedge against a drop in oil prices, since refining margins improve in that environment.
Click Here: Get a Full MRO Stock Analysis!
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-- Written by Simon Monger
