Chasing Procter & Gamble's Reliable Dividends? A Hidden Opportunity Awaits For Savvy Investors

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Founded in 1837, The Procter & Gamble Company (NYSE:PG) is one of the largest manufacturers of fast-moving consumer goods. The conglomerate has weathered economic storms and market fluctuations, proving its resilience time and again.

P&G’s diversified product base provides a steady stream of revenue, allowing it to disburse dividends even in uncertain times. This makes P&G a safe haven for income investors.

The company pays $4.03 in dividends annually, yielding 2.5% on the current price. The S&P 500 constituent has consistently raised dividends for 67 years, making it a Dividend King. Its latest dividend increase was announced earlier this month, raising its payout from $0.94 to almost $1.01. Unsurprisingly, Procter & Gamble stock has surged by roughly 10% year-to-date.

Is The Dividend King Stock Worth It?

Procter & Gamble has long been hailed for its reliability in delivering dividends. However, recent financial indicators suggest a shift in the wind, prompting investors to consider alternative avenues for maximizing returns.

The company’s fiscal third-quarter earnings per share came in at $1.52 adjusted, surpassing Wall Street expectations of $1.41. However, revenue fell short of projections with P&G reporting $20.2 billion, missing expectations by $240 million. Net income attributable to the company for the quarter amounted to $3.75 billion, or $1.52 per share, up from nearly $3.4 billion, or $1.37 per share, a year earlier.

Despite PG’s reputation for stability, its current dividend yield of 2.5% falls short when compared to the inflation rate of 3.4%. This raises concerns among investors about the real value of income generated by holding PG stock.

The company, renowned for its household brands like Charmin and Tide, reported stagnant volume growth across its product lines in the last reported quarter, with only its grooming business showing any signs of improvement. This flat performance underscores a significant shift in consumer behavior, as people appear to be pulling back on purchases of P&G products, a trend that could have broader implications for the company’s financial health moving forward.

A Higher-Yielding Income Approach

For investors seeking high yields that will outpace stubborn inflation, the Cityfunds Yield fund offers a compelling alternative. Backed by real estate assets in the country’s most promising markets, the fund offers a reliable passive income stream.

Here’s what makes the Cityfunds Yield fund stand out:

• Targeting a stable 8% APY with quarterly distributions

• Backed by a diversified pool of collateralized real estate loans

• Invests in home equity agreement-backed notes and short-term mortgage notes

• Offers a manager-guaranteed base yield of 7%

• Five-year term fund with redemption available after a 12-month lock-up

By investing in a mix of home equity-backed notes and short-term mortgages, Cityfunds aims to generate steady interest income that can be distributed to investors on a quarterly basis. The fund’s 65% to 80% loan-to-value target on its home equity investments provides an added layer of security.

See how much you could be earning with the Cityfunds Yield fund.

The Bottom Line

While Procter & Gamble has proven to be a reliable dividend stock for several decades, savvy investors know that a healthy portfolio is diversified across multiple asset classes, especially when it comes to generating income.

This article Chasing Procter & Gamble's Reliable Dividends? A Hidden Opportunity Awaits For Savvy Investors originally appeared on Benzinga.com

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