This 2.9%-Yielding Dividend Stock Has Paid Investors for More Than a Century — and It’s on Sale

A stock’s track record is important for dividend investors because it can symbolize not only the company’s commitment to keeping the payout going, but also just how solid and stable its financial results have been over the long term. After all, for a company to be paying dividends for decades, it will have experienced a myriad of challenges and economic cycles. Being able to continue paying a dividend over a long stretch highlights financial resilience that isn’t common.

One dividend stock that is truly special is Procter & Gamble (NYSE: PG). It has not only been paying a dividend to its shareholders for more than a century, but it’s also been increasing its payout for decades. The consumer goods stock is down 8% over the past 12 months, and here’s why it could be a great buy on the dip.

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Procter & Gamble’s stable finances make it a safe investment

Another thing dividend investors often value beyond just a stock’s track record is its overall stability. Procter & Gamble may not be much of a growth stock, but it’s definitely a stable business, with billions of consumers all over the world using its products. In each of its past four fiscal years, the company’s top line has been within a range of $80 billion and $85 billion. Its annual earnings have been within an even narrower range of $14 billion to $16 billion.

The company is an excellent example of a good, boring stock that you can depend on for reliable dividend income. Even though it may not always come out with new and exciting products, between inflation and population growth, the company can steadily continue to grow its top and bottom lines over the long term.

Its growing dividend has given investors a big boost over the years

On April 14, Procter & Gamble announced it would be raising its dividend for an incredible 70th consecutive year. This year will also mark the 136th year that it has paid a dividend since it was incorporated in 1890.

While investors may scoff at the stock for its lackluster returns over the years, by reinvesting the dividend, which currently yields around 2.9%, the gains from owning Procter & Gamble become much more significant. Over the past decade, the stock has risen by around 87%, which equates to a compounded annual growth rate (CAGR) of approximately 6.5%. But when you include its dividend, then its total returns are up around 145%, and the CAGR is about 9.4%.