Brightening my portfolio’s smile with Colgate

Not everything I buy is on sale.

That doesn’t always mean it’s a bad buy, though.

Look no further than Tuesday’s purchase …

Colgate

I picked up a share of Colgate-Palmolive Company (CL) for $73.02. It’s the 46th company in my portfolio that pays quarterly dividends in February, May, August and November. Each quarterly dividend is worth $0.40, meaning the purchase increased my forward annual dividend income by $1.60. Nice, right?

With a P/E ratio of 27.14, I wouldn’t say the company is cheap by any means. The way I see it, though, thanks to a handful of recent analyst upgrades (some of which set price targets signaling a 15% upside), now is as good a time as any to buy the quality company.

Colgate-Palmolive hasn’t been tearing it up in terms of sales. Things have been lagging a bit of late, but the company sells something every man, woman and child in this world needs: toothpaste. I use the stuff every single day. You do, too. Same with everyone you know … or just about everyone you know. That alone makes it worth buying in my opinion.

I like the dividend, too.

Colgate has an OK payout ratio of 59.48% and a steady 2.19% yield. I have stocks in my portfolio that have lower payout ratios and higher yields, but they haven’t been growing their dividends for 53 straight years like Colgate has. The raises haven’t always been eye-popping, with the most recent a 3.3% bump in 2016, but a raise is a raise. The fact the company has been dedicated to its dividend for so long means a lot to me.

Overall, I’m pretty happy with the purchase.

I’ll probably make another purchase tomorrow, so swing back by to see what I buy.

March on!