Unilever looks like a high-quality defensive business, but the current valuation already reflects a significant part of its resilience. The multiples present a mixed picture: P/S of 3.36 and P/FCF of 36.29 are noticeably above the industry medians, indicating an expensive valuation relative to revenue and free cash flow. At the same time, P/E and P/B are not disclosed, so relying on cash-flow and revenue multiples is especially important, and they look demanding. A strength remains the high and stable profitability: net profit margin of 8.83% and operating margin of 11.18% are above the industry median, supporting a premium to the sector. However, gross margin looks weaker than the industry benchmark, which limits the potential for further profit expansion without improvements in pricing or cost structure. Liquidity, on the other hand, calls for caution: current ratio of 0.79 and quick ratio of 0.58 are below normal, suggesting dependence on working capital and the need for careful management of short-term liabilities. Debt load by debt/equity is formally low, which is a positive, but absolute liabilities remain significant, and the balance sheet does not look overly liquid. Dividend yield of 0.84% is rising, but for the consumer sector it is still moderate and does not seem like a sufficient argument for a meaningful re-rating. On the operating side, revenue, net income, and operating income remain at high levels, and net worth has also increased, confirming the business’s resilience. At the same time, assets and equity have recently declined from higher levels, which tempers optimism about balance-sheet dynamics. Overall, the fundamentals support a stable but not aggressive valuation: the business is high-quality and defensive, but expensive multiples and weak liquidity limit the upside. For an investor, this means the current forecast should be slightly reduced while still acknowledging the strong operating base and dividend resilience.

Unilever PLC

Сильный индекс, незначительно вырос. Быки крепко уверены в своих позициях.

Strong index, slightly up. The bulls are very confident in their positions.

Сильный индекс, незначительно вырос. Рынок не поддерживает быков.

Strong index, slightly up. The market does not support the bulls.

Сильный индекс, значительно вырос. Приток средств в лонги резко увеличился и находится на высоком уровне.

Strong index, significantly up. The inflow of funds into longs has increased sharply and is at a high level.

Strong margins and stable profitability support Unilever, but expensive P/S and P/FCF, weak liquidity, and moderate dividend yield limit the upside.

The Procter & Gamble Company PG continues to benefit from its strong market position, supported by ongoing productivity initiatives and a focus on cost efficiency. From a valuation standpoint, however, the stock presents a mixed picture. PG currently trades at a forward 12-month price-to-earnings (P/E) ratio of 20.22X, below its five-year median of 23.34X. Despite this discount to its historical valuation, the multiple remains above the Zacks Consumer Products – Staples industry average of 18.12X, indicating that the stock commands a premium relative to its peers.
A similar premium is evident on a price-to-sales (P/S) basis. Procter & Gamble’s P/S ratio of 3.73X stands well above the industry multiple of 2.22X. This relatively elevated valuation may limit the stock’s appeal for value-oriented investors, particularly given its Value Score of D. Taken together, these valuation metrics suggest that while PG is trading below its own historical P/E median, its premium relative to the industry warrants some caution at current levels.
PG’s Premium Valuation Surpasses Peers
At a forward 12-month P/E multiple of 20.22X, Procter & Gamble trades at a notable premium to its peers, including The Clorox Company CLX, Unilever PLC UL and Albertsons Companies, Inc. ACI.
Clorox, Unilever and Albertsons Companies currently trade at forward P/E multiples of 15.01X, 16.73X and 7.03X, respectively — all well below PG’s valuation. This wide valuation gap suggests that investors are assigning a sizable premium to Procter & Gamble, making the stock appear relatively expensive compared with these peers.
PG’s elevated valuation also implies that the market is pricing in strong expectations for its future performance. While its brand strength, scale and execution capabilities may support a premium multiple, the current valuation leaves less room for disappointment. Procter & Gamble will need to deliver sustained earnings growth and solid operating performance to justify this premium. Until then, the stock appears somewhat overvalued relative to its peer group.
Despite trading at a premium valuation, Procter & Gamble’s shares have remained under pressure in recent months. In the past three months, PG stock has lost 4.5% compared with a 2.3% decline for the broader industry. The stock has also underperformed the Zacks Consumer Staples sector, which fell 1.6%, as well as the S&P 500, which gained 1.9% in the same period.
PG’s 3-Month Performance
Image Source: Zacks Investment Research
Nevertheless, Procter & Gamble has fared better than some of its peers. Shares of Clorox and Albertsons Companies have declined 8.3% and 24.1%, respectively, in the past three months. However, PG has lagged Unilever, whose shares advanced 4.6% in the same period.
At its current share price of $142.97, PG trades 14.5% below its 52-week high of $167.25 and 3.9% above its 52-week low of $137.62. The stock is also trading below its 50-day and 200-day moving averages, pointing to continued weakness in near-term price momentum. Moving averages are widely used technical indicators that help assess prevailing stock-price trends and market momentum.
Procter & Gamble Trades Below 50 & 200-Day SMA
Image Source: Zacks Investment Research
PG’s Growth Drivers vs. Market Challenges
Procter & Gamble’s growth outlook is supported by its integrated strategy centered on product superiority, innovation, productivity and stronger consumer engagement. Management highlighted improving global share trends, broad-based organic sales growth across most categories and regions, and solid momentum in markets such as Greater China and Latin America.
The company is also strengthening its core brands through product upgrades while expanding into adjacent growth opportunities. Tide’s upgraded liquid detergent, Tide evo, premium Baby Care products in China and stronger digital commerce execution illustrate how PG is using innovation to drive user growth, category expansion and market-share gains.
At the same time, productivity remains a key enabler, allowing the company to fund brand investment, media, R&D and supply-chain capabilities while supporting profitability. Procter & Gamble is also scaling AI-enabled brand building, data-driven work processes and Supply Chain 3.0 to improve speed, execution and consumer reach.
However, the operating environment remains challenging. Management expects continued volatility across consumer demand, commodities, currencies, retail dynamics and geopolitics. Fiscal 2027 guidance assumes only 1-3% organic sales growth, with restructuring creating a 30-50 basis-point headwind.
Higher raw-material, energy, transportation and supply-chain costs are expected to create about $1 billion of after-tax pressure, while foreign exchange, interest expense and lower nonoperating income add further strain. Slower category growth in North America and Europe, rising promotional intensity and continued consumer value sensitivity also pose risks.
Procter & Gamble therefore needs sustained innovation, disciplined pricing and productivity gains to offset cost pressures and return to stronger, balanced growth in the coming fiscal year.
PG’s Estimate Revision Trend
The Zacks Consensus Estimate for Procter & Gamble’s fiscal 2027 EPS has moved down 0.3% in the past 30 days. Meanwhile, the consensus mark for fiscal 2028 EPS has been unchanged in the past 30 days.
For fiscal 2027, the Zacks Consensus Estimate for PG’s revenues and EPS implies year-over-year growth of 1.8% and 1.5%, respectively. The consensus mark for fiscal 2028 revenues and EPS indicates 2.7% and 6.2% growth year over year, respectively.
Image Source: Zacks Investment Research
How to Play PG Stock Now?
Procter & Gamble’s premium valuation makes the stock relatively expensive compared with the broader industry and several key peers. Nevertheless, the elevated multiple also suggests that investors continue to place considerable confidence in the company’s strong brands, market position, innovation capabilities and long-term earnings potential, despite the recent weakness in its share price.
While productivity initiatives, portfolio strength and improving market-share trends remain encouraging, near-term growth is constrained by cost inflation, softer category growth, consumer value sensitivity and other macroeconomic uncertainties. Moreover, downward estimate revisions for fiscal 2027 warrant some caution.
Given this balance of solid underlying fundamentals and a demanding valuation, investors may prefer to retain their positions rather than chase the stock at current levels. Holding this Zacks Rank #3 (Hold) stock appears prudent until there is greater clarity on PG’s growth trajectory, margin recovery and ability to justify its premium valuation. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Procter & Gamble Stock Looks Pricey: What's the Best Move Now?

Key Points
Unilever is the steady global anchor, with everyday brands and a solid dividend.
Colgate-Palmolive is the boring-but-reliable pick, built around products people keep buying.
Mondelez adds a little more growth potential through its strong snack brands and emerging-market exposure.
When I think about consumer dividend stocks that actually feel comfortable to hold, I want brands you see on shelves every week and payouts that have become part of the company's identity.
Unilever (NYSE: UL), Colgate-Palmolive (NYSE: CL), and Mondelez (NASDAQ: MDLZ) all fit that description. Together, they give you a mix of staples, hygiene, and snacks that can anchor an income-focused portfolio. Let's find out a bit more about these three high-yield dividend stocks and why they might be good buys right now.
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1. Unilever: Global staples, steady checks
Unilever is about as classic a consumer goods company as you can find. It owns brands like Dove, Axe, Hellmann's, and Ben & Jerry's, and sells personal care, home care, and food products in more than 100 countries. That mix gives you exposure to everyday habits rather than fashion trends. People wash, cook, and clean through thick and thin.
The dividend fits that profile. Unilever pays quarterly, with its second-quarter 2026 dividend announced on July 28, going ex-dividend on Aug. 6, and paid in mid-September. The forward yield is around 3.5% at the moment, comfortably above the market and backed by earnings and free cash flow generated by thousands of small purchases rather than a few big contracts.
What I like here is how simple the story is. Management focuses on modest volume growth, pricing discipline, and brand investment, and then sends a portion of the result to shareholders like clockwork. I think Unilever is a solid buy right now because the stock has bounced strongly from its yearly lows near $55 per share and is making its way back toward the high-$70s. The technical setup looks encouraging, and when you combine that momentum with management's current strategy and execution, Unilever looks safe and strong.
2. Colgate-Palmolive: Oral care and household resilience
Colgate-Palmolive sits closer to the "boring is good" end of the spectrum. It dominates toothpaste in many markets, sells soaps and cleaners, and leans heavily on health and hygiene as core themes. That business has low drama, which is a feature when your goal is income.
The company pays a regular quarterly dividend, currently at $0.53 per share, with recent ex-dividend dates in April and July 2026 and payments in May and August. The yield is lower than that of some high-yield names, currently around 2.4%, but it has grown steadily over time and is supported by a strong balance sheet and stable cash generation.
For a dividend investor looking for a solid buy right now, Colgate-Palmolive is a reliable, lower-risk component. The company's management is also pushing for better U.S. advertising and premium products to combat some of its weak domestic performance. Its products are small line items in household budgets, yet they carry strong brand loyalty. If the company's premium products take off, the ticker could soon give elevated returns.
3. Mondelez: Snacks with staying power
Mondelez gives you a different angle on consumer goods. It focuses on snacks and confectionery, with brands like Oreo, Cadbury, Toblerone, and Ritz. These products may not be as essential as toothpaste, but they are deeply embedded in routines, from lunch boxes to office pantries. That makes revenue surprisingly resilient.
The company pays a quarterly dividend of $0.50 per share, with recent ex-dividend dates on June 30 and payments on July 14, and a yield of around 3.2% to a bit above that. Management has raised the dividend annually for more than a decade and combines payouts with buybacks, so total shareholder yield looks better than the headline number.
What makes Mondelez interesting now is its push into emerging markets. Snack demand is growing faster in places like India and Latin America than in mature markets, and the company has been investing heavily there. That gives you a mix of defensive and growth brands, which can support both the dividend and the stock price over time.
Different reasons for being great dividend payers
If I were building a consumer-facing dividend basket today, I would think of Unilever as the global staple anchor, Colgate-Palmolive as the health-and-hygiene stabilizer, and Mondelez as the growth-leaning snack play. Together, they give you exposure to very different kinds of everyday spending, backed by management teams that have treated dividends as a core part of their approach to returning value to shareholders.
Should you buy stock in Unilever right now?
Before you buy stock in Unilever, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Unilever wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $429,223!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,318,055!*
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Micah Zimmerman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Colgate-Palmolive. The Motley Fool recommends Unilever. The Motley Fool has a disclosure policy.
Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

My 3 Favorite High-Yield Dividend Stocks to Buy Right Now

Key Points
Unilever has everyday brands, global reach, and a solid dividend, making it a steady income pick.
People still need diapers, tissues, and toilet paper in a tough economy, so Kimberly-Clark is a solid buy.
Mondelez has a slightly lower yield, but strong snack brands and a history of raising payouts give it room to grow.
If you want passive income that feels sturdy even when markets wobble, it makes sense to lean on companies that sell everyday stuff and share the cash with you. These three consumer goods stocks with yields of around 3% to 5% fit that bill and deserve a serious look.
1. Unilever: steady checks
Unilever (NYSE: UL) sits behind a long list of brands you see without thinking, from soaps and shampoos to sauces and ice cream, sold in more than 190 countries. That spread means your dividend is linked to millions of small habits, not one product cycle or one region.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
On the income side, Unilever has paid dividends for decades and maintains a regular quarterly schedule, with its Q2 2026 dividend announced in late July and paid in September. Currently, the forward yield sits at around 3.5%. That is not eye-popping, but it is backed by a business that sells necessities across both developed and emerging markets. For passive income, that mix of global reach and mid single-digit yield is a strong base layer.
2. Kimberly-Clark: essential paper products
Kimberly-Clark (NASDAQ: KMB) is even simpler to understand. I just had my first baby, and I now realize how quickly parents burn through baby products. Kimberly-Clark makes paper products people use every single day, including tissues, diapers, and toilet paper. Demand does not spike wildly, but it also does not disappear when the economy slows. Households keep buying these items because they have to, which is exactly what you want behind a dividend.
The company has a long history of paying and raising its dividend. In January 2026, the board increased the regular quarterly payout to $1.28 per share, and that new rate was confirmed again in a May release for the July payment. Recent data shows a current yield of around 4.6% to a bit above 5%, putting Kimberly-Clark solidly in the high-income camp within consumer staples.
That kind of yield, backed by essential products and a management team that treats the dividend as a core promise, makes KMB an appealing choice if you care more about checks arriving than about headlines. Kimberly-Clark is also a Dividend King, meaning it has raised its dividend for at least 50 consecutive years.
3. Mondelez: chocolate and growing payouts
Mondelez (NASDAQ: MDLZ) offers a distinct flavor of consumer goods income. It owns snack and confectionery brands such as Oreo, Cadbury, Toblerone, and Ritz, which appear in lunchboxes, office kitchens, and checkout lanes worldwide. Snacks are not as essential as soap or diapers, but they are deeply embedded in daily routines and often hold up well even when consumers feel pressure elsewhere in their budgets.
From a dividend perspective, Mondelez has quietly built a solid track record. The company pays a regular quarterly dividend, recently at $0.50 per share, with ex-dividend dates in June and September 2026. Its current yield sits around 3.1% to 3.4%, ahead of the broad U.S. market average and in line with many defensive names. More importantly, Mondelez has been edging up that payout over time while pairing dividends with buybacks, so total cash returned to shareholders looks better than the headline yield alone suggests.
Why these three work for passive income
Unilever, Kimberly-Clark, and Mondelez are not trying to reinvent themselves every year. They refine brands, manage costs, and nudge prices, but the core of the story is simple: sell billions of units of everyday products and send a chunk of the resulting cash back to owners.
If your goal is passive income, owning three different consumer goods businesses that yield around 3% to 5% and have long histories of paying shareholders is a practical way to build a base you can sleep on. Over time, reinvesting those dividends or simply letting them accumulate gives you more flexibility with your money.
Should you buy stock in Kimberly-Clark right now?
Before you buy stock in Kimberly-Clark, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Kimberly-Clark wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
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*Stock Advisor returns as of August 18, 2026.
Micah Zimmerman has no position in any of the stocks mentioned. The Motley Fool recommends Unilever. The Motley Fool has a disclosure policy.

3 Top Dividend Stocks Yielding 3% or More to Buy Right Now for Passive Income

In trading on Tuesday, shares of Unilever plc (Symbol: UL) crossed above their 200 day moving average of $63.77, changing hands as high as $67.05 per share. Unilever plc shares are currently trading up about 9.1% on the day. The chart below shows the one year performance of UL shares, versus its 200 day moving average:
Looking at the chart above, UL's low point in its 52 week range is $54.75 per share, with $74.975 as the 52 week high point — that compares with a last trade of $67.16.
Click here to find out which 9 other dividend stocks recently crossed above their 200 day moving average »
Further UL Research:
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Unilever Breaks Above 200-Day Moving Average - Bullish for UL

Key Points
Stanley Black & Decker is a Dividend King that has materially transformed its business for the better.
McCormick is a leader in spices and flavorings, and it is working on a transformative acquisition.
Realty Income is a giant (and boring) net lease REIT with an over 5% yield.
Wall Street is so focused on technology stocks and artificial intelligence right now that it is ignoring great businesses with impressive dividends. And some of those businesses also have great dividend track records. If you are a dividend investor, these three beaten-down stocks could be just what you are looking for to power your income portfolio.
Stanley Black & Decker (NYSE: SWK) is a Dividend King that has rewarded investors with reliable passive income for over 50 years. McCormick (NYSE: MKC) is one of the world's leading spice producers, with a 38-year streak of annual dividend hikes. And Realty Income (NYSE: O) is a net-lease juggernaut with a dividend streak that's up to 31 years. Here's a closer look at each one.
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Stanley Black & Decker is turning things around
Stanley Black & Decker's dividend yield is around 3.7%, which is more than three times the roughly 1.1% yield of the S&P 500 index (SNPINDEX: ^GSPC). As noted, the industrial company is a Dividend King. It primarily makes tools, which are essential for building anything. It also makes fasteners.
The company went through a period in which it made a series of rapid, large acquisitions. That left it bloated, heavily leveraged, and with a poorly focused portfolio. Management has been working to change the narrative, selling assets, slimming down, and recentering on its core tool operations. Notably, net debt to adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) has fallen from 5.9x at the end of 2023 to 3.4x at the end of 2025. The goal is to reach 2.5x by the end of 2026. Leverage is no longer the issue it once was.
On the profitability front, the company's adjusted gross margin continues to improve, nearing the company's target range of 35% to 37%. Adjusted earnings per share guidance for 2026 of between $4.90 and $5.70 will more than cover the $3.32 in dividends per share the company will pay for the year. It looks like the company is back on track, but Wall Street remains downbeat, creating an opportunity for long-term dividend investors.
McCormick is working on a transformational acquisition
McCormick's dividend yield is also around 3.7%. That's historically high for this well-respected consumer staples company. The dividend has been increased annually for 38 years. The company is one of the largest spice producers in the world and has been expanding in the flavors space, as well.
Right now, investors are worried about the company's planned acquisition of Unilever's (NYSE: UL) food business, which consists of Hellmann's mayonnaise and Knorr. Both fit well with McCormick's business, but the deal will roughly double its size. There are material execution risks to consider. However, McCormick has some experience with acquisitions, and Unilever's food business is well run. Unilever is also taking a stake in McCormick, so it has a vested interest in ensuring the deal works out well.
If you don't mind collecting an attractive yield while you wait for this deal to be consummate, McCormick could be a good dividend stock for your portfolio.
Realty Income is the net lease giant
Realty Income's dividend yield is 5.1%, backed by a monthly pay dividend that has been increased annually for 31 years. The company is a slow-and-steady dividend tortoise that can provide a reliable, high-yield foundation for any dividend portfolio. Even the most conservative dividend investors will appreciate this real estate investment trust (REIT).
Realty Income owns a portfolio of over 15,500 properties. Most of its assets are single-tenant net-lease properties. This means its tenants have to pay for most property-level costs, materially reducing the REIT's costs and risk. The portfolio is focused on retail assets, but it also owns industrial properties and other, more unique assets, like casinos and data centers. About 80% of its rents come from North America, with the rest derived from Europe. Diversification and safety are key themes, noting that even during the Great Recession, occupancy didn't fall below 96%.
Realty Income's stock still hasn't recovered from the COVID pandemic sell-off. You shouldn't expect massive growth from Realty Income, but it is a reliable dividend payer that still looks underappreciated by Wall Street.
Three solid options for your income portfolio
Wall Street is focused on tech stocks and artificial intelligence today. It is overlooking boring old businesses like Stanley Black & Decker, McCormick, and Realty Income. That's a dividend opportunity for investors who think long term and don't mind venturing into areas other investors ignore.
Should you buy stock in Realty Income right now?
Before you buy stock in Realty Income, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Realty Income wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $400,964!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,272,955!*
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*Stock Advisor returns as of July 17, 2026.
Reuben Gregg Brewer has positions in McCormick, Realty Income, Stanley Black & Decker, and Unilever. The Motley Fool has positions in and recommends Realty Income. The Motley Fool recommends McCormick and Unilever. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

3 Beaten-Down Stocks Built for Long-Term Passive Income

Key Points
The Kraft Heinz merger didn't work out as well as Warren Buffett had hoped.
Kraft and Heinz were both struggling businesses when they merged.
McCormick is an industry-leading spice and flavor company looking to acquire Uliver's industry-leading food brands.
Greg Abel took over the CEO job at Berkshire Hathaway (NYSE: BRKA)(NYSE: BRKB) from Warren Buffett at the start of 2026. He's already proven to be a more proactive manager when it comes to the stocks Berkshire Hathaway owns and businesses it buys. One interesting move was his behind-the-scenes push to stop Kraft Heinz (NASDAQ: KHC) from splitting up its business. Despite the troubles Kraft Heinz has faced, Abel should still consider buying into McCormick (NYSE: MKC) and its planned acquisition.
One mistake is not a reason to avoid all consumer staples mergers
The Kraft Heinz merger was backed by Buffett, and it didn't work out well. But there was a problem with the deal from day one. Both Kraft and Heinz were bloated companies struggling to get back on track. The entire purpose of the merger was to simply cut costs, which is fine to a point. However, the consumer staples space is driven by innovation and advertising. Kraft Heinz focused so much on cost-cutting that it stopped being an innovative company. And advertising wasn't spared in the cost-cutting effort, either.
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Despite the less-than-desirable outcome with Kraft Heinz, Abel is pushing the company's new leadership team to right the ship before splitting the business in two again. Two bad companies are no better than one bad company. Despite Kraft Heinz's troubles, Abel should consider buying McCormick, as it is looking to acquire Unilever's (NYSE: UL) food business.
A big deal and a unique opportunity
This is a very large transaction for McCormick, as it will roughly double the company's size. Investors are worried about the transaction, noting that McCormick's stock fell on the news. It rose as investors digested the story, but then tumbled around 15% as the scope of the deal came into focus. While the shares have recovered after a solid quarterly earnings update, the stock has basically gone nowhere since the acquisition announcement.
So there's still time for Abel to buy McCormick while it offers a historically high 3.7% yield and a historically low price-to-earnings ratio of roughly 9x. The big opportunity for Abel is helping to finance the transaction, which could allow him to buy preferred stock, a share type that Buffett used to great effect with Bank of America (NYSE: BAC) when the giant bank needed cash.
The key to the story, however, is that McCormick isn't a struggling consumer staples company. It is an industry leader in spices and flavors. Unilever's food business, which is largely made up of Hellmann's and Knorr, is also well run. Helping two good businesses come together is a far more compelling investment opportunity than merging businesses solely to cut costs.
Abel has plenty of firepower
Berkshire Hathaway ended the first quarter of 2026 with nearly $400 billion in cash on its balance sheet. McCormick's deal with Unilever will require it to raise roughly $16 billion in cash. That's a drop in the bucket for Berkshire Hathaway, but it could get the company into an industry-leading consumer staples business that's on the verge of buying a long-term growth catalyst. Just because Kraft Heinz didn't work out, it doesn't mean McCormick's transformative deal won't be a success.
Should you buy stock in McCormick right now?
Before you buy stock in McCormick, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and McCormick wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $395,679!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,294,805!*
Now, it’s worth noting Stock Advisor’s total average return is 929% — a market-crushing outperformance compared to 211% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
Bank of America is an advertising partner of Motley Fool Money. Reuben Gregg Brewer has positions in McCormick and Unilever. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool recommends Kraft Heinz, McCormick, and Unilever. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This Looks Like the Perfect Stock for Warren Buffett and Greg Abel to Buy Right Now

Key Points
The company's core seasoning business has lost market share over the past few years to cheaper alternatives in the spice aisle.
Unilever Foods brands like Hellmann's and Knorr face less competition from store brands.
Integration will be a challenge, as the deal is not expected to close until at least mid-2027.
The spice aisle will no longer determine McCormick's (NYSE: MKC) fate. In March, the 137-year-old company announced an agreement to merge with Unilever's (NYSE: UL) food division, a business 1.5 times its size, in a $45 billion transaction.
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The deal adds established brands like Hellmann's mayonnaise and Knorr bouillon to McCormick's portfolio, alongside household favorites like French's mustard and Frank's RedHot sauce.
The addition of Unilever Foods is an attempt to address the structural weakness that has weighed on the stock over the past few years. The complex nature of the transaction has done little to win over investors.
A strategic shift away from seasonings
The stock has been under pressure from the growth of private-label brands. In its core spice and seasoning category, store brands now command nearly 40% of unit volume, one of the highest penetrations in any grocery aisle.
This has eroded the company's pricing power and contributed to its recent underperformance. The merger is designed to dilute the effect of this challenged category.
Post-merger, the spice business will shrink from over 30% of total sales to less than 15%. In its place, McCormick adds categories like mayonnaise and bouillon, which face less private-label competition due to strong brand loyalty and taste differentiation.
The combined company will be larger, more diversified, and more profitable, with operating margins projected to expand from 17% to 21% post-integration. Yet, some investors see a complex transaction that dilutes current shareholders, adds significant debt, and creates a year-long overhang.
Integration will take time
The transaction is structured as a Reverse Morris Trust, which complicates matters for shareholders of both companies. Existing McCormick shareholders will be heavily diluted, while debt on the balance sheet will increase to 4 times net debt-to-earnings before interest, taxes, depreciation, and amortization (EBITDA).
Meanwhile, Unilever shareholders may create selling pressure on the stock after receiving their MKC shares.
The strategic rationale for reducing spice exposure is sound, but the execution risks create uncertainty. The merger is not expected to close until mid-2027 at the earliest, creating an extended overhang.
Currently, with inflation driving shoppers to cheaper alternatives, there's no reason to rush into the stock. As the dust settles on the deal and we get a better sense of the company's integration plans and cost structure, the stock could be worth a closer look.
Should you buy stock in McCormick right now?
Before you buy stock in McCormick, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and McCormick wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $409,970!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,200,223!*
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*Stock Advisor returns as of July 7, 2026.
Bryan White has no position in any of the stocks mentioned. The Motley Fool recommends McCormick. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

McCormick Is Shifting From the Spice Rack to the Refrigerator With This $45 Billion Deal

Key Points
Colgate-Palmolive doesn’t depend on the U.S. market to drive sales growth.
The company’s margins are strong, although they have ticked down in recent years.
Colgate-Palmolive is expensive for all the right reasons.
As of market close on July 3, the S&P 500 (SNPINDEX: ^GSPC) and the Nasdaq-100 are up 9.3% and 16.2%, respectively, year to date (YTD). This is well ahead of their historical average annual gains. The tech sector, especially semiconductor stocks, has been the driver of broader market returns. But that doesn't mean all value stocks are underperforming the major indexes.
Colgate-Palmolive (NYSE: CL) is up 20.4% YTD. And it's also an ultra-reliable dividend stock that has paid uninterrupted dividends since 1895 and has increased its payout for 63 consecutive years. That streak earns Colgate-Palmolive a spot on the list of Dividend Kings, which are companies that have paid and increased their dividends for at least 50 consecutive years.
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Here's why Colgate-Palmolive remains a top buy now even after its recent run-up.
Colgate-Palmolive is at the top of its game
Colgate-Palmolive has been a standout in the household and personal products industry. The company is guiding for 2026 net sales growth of 2% to 6% and organic sales growth of 1% to 4% at a time when many of its peers are experiencing sales declines. And even with margins under pressure, Colgate-Palmolive remains one of the most profitable companies in its industry. By comparison, Unilever, Kenvue, Church & Dwight, Clorox, Kimberly-Clark, and Estee Lauder all have operating margins under 20%.
The industry has been dealing with inflationary pressures and consumer resistance to price increases. But Colgate-Palmolive has done a masterful job of navigating these challenges through its elite brand portfolio, highly efficient supply chain and operations, and geographic diversification.
In addition to its flagship Colgate and Palmolive brands, the company owns Softsoap, Irish Spring, Tom's of Maine, and Speed Stick, among others. One of Colgate-Palmolive's top brands, Hill's Pet Nutrition, made up 23% of total 2025 sales.
Without factoring in Hill's, Europe, Middle East, and Africa (EMEA), Latin America, and Asia Pacific sales are more than triple those of North America, which has helped make Colgate-Palmolive resistant to U.S.-specific inflationary pressures. In the first quarter of 2026, North America was the only region that reported declining net and organic sales, while Latin America and EMEA posted double-digit growth and total company net sales rose 8.4% year over year.
A dividend you can count on
Colgate-Palmolive is far from cheap -- trading at 25 times forward earnings -- because the stock price has been rising faster than the company's earnings growth. But Colgate-Palmolive deserves its premium valuation because its results are solid despite a difficult operating environment. This resilience is particularly appealing to risk-averse folks seeking a stable passive income stream to help supplement retirement income. If inflationary pressures ease and consumer spending improves, a rising tide will lift the broader household and personal products industry. But Colgate-Palmolive isn't dependent on those factors to drive sales growth.
Colgate-Palmolive yields 2.2%, which is good but not quite high-yield territory. Many of its peers offer higher yields because they distribute the vast majority of their cash flow to shareholders through dividends, whereas Colgate-Palmolive's dividend is highly affordable. Its trailing-12-month free cash flow per share is at an all-time high of $4.66, well over double its $2.06 per-share annualized dividend.
So while Colgate-Palmolive could easily afford to pay a higher dividend, the company prefers a balanced approach of using cash to reinvest in the business, paying a steadily growing (and manageable) dividend, and buying back stock. Colgate-Palmolive has reduced its share count by 10% over the last decade, which has helped make the stock a better value.
Investing in a market leader
Colgate-Palmolive's geographic diversification and portfolio of leading brands across pet nutrition and oral, personal, and home care make it highly recession resistant. The company continues to deliver solid growth through volume and price increases, while many of its peers face a difficult trade-off: either cutting prices to drive volume or keeping prices high at the expense of lower sales volumes.
All told, Colgate-Palmolive stands out as one of the most reliable dividend-paying stocks on the market. It's a top buy for the second half of the year for investors who don't mind paying a premium price for a quality company.
Should you buy stock in Colgate-Palmolive right now?
Before you buy stock in Colgate-Palmolive, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Colgate-Palmolive wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $418,761!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,195,804!*
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*Stock Advisor returns as of July 7, 2026.
Daniel Foelber has positions in Estée Lauder Companies, Kenvue, and Kimberly Clark. The Motley Fool has positions in and recommends Colgate-Palmolive. The Motley Fool recommends Kenvue and Unilever. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Meet the Dividend King Stock That's Up 20% in 2026. Here's Why It Can Continue Outperforming the S&P 500 and Nasdaq-100 in the Second Half.

Key Points
Costco is one of the world's largest retailers and has grown strongly for years.
The stock's yield is modest, and its valuation is lofty.
I have been watching this other consumer stock for years, and it is finally trading at an attractive level.
There's a difference between a company and its stock. Costco (NASDAQ: COST) is a great example of the dichotomy. It is a well-run company, but the stock is very expensive. Paying too much for a great company can turn it into a bad investment. I just can't see owning Costco for the next decade.
However, McCormick (NYSE: MKC) is a well-run company with an attractive valuation. In fact, I recently initiated a position in the stock. Here's why I think McCormick is a better investment opportunity over the next 10 years than Costco.
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Costco is a great company
There's nothing wrong with Costco as a business. It is one of the world's largest retailers. It operates under a club store model, meaning customers pay an annual fee to shop at Costco stores. That membership fee creates an annuity-like income stream that allows Costco to keep its prices low and service levels high.
As a business, I absolutely love Costco. If someone wanted to buy it, I would be hard-pressed to dissuade them. However, I'm a dividend investor with a value bias. Costco's yield is 0.6%, which is even lower than the 1% yield on offer from the S&P 500 index (SNPINDEX: ^GSPC). That's not enough income to meet my needs.
Meanwhile, the price-to-sales ratio is 1.4x compared to a five-year average of 1.2x. The price-to-earnings ratio is 47x compared to a longer-term average of 45x. And the price-to-book ratio is 12.6x, which is only slightly below its 12.7x five-year average. All in, Costco's stock looks expensive to me. I think growth investors will probably make out well with Costco if they buy and hold for the long term, but that's just not how I invest.
McCormick is right up my alley
McCormick is one of the world's largest producers of spices and flavorings. It has a global reach and a solid history of business growth. Compared to Costco, it looks like a slow-and-steady tortoise, but that's not a problem for me. In fact, I like companies that are boring and sell relatively low-cost products that consumers buy regularly. Consumer staples makers like McCormick tend to be resilient in the face of bear markets and recessions.
Right now, however, McCormick is out of favor. Earnings have been pressured by inflation. Sales haven't been as robust as Wall Street hoped. That's OK, given McCormick's long and successful history as a business, I'm confident the company will muddle through this weak spot and thrive again. Especially when I look out over the next decade.
That said, Wall Street's short-term focus has opened up a buying opportunity. The stock's yield is historically high at roughly 3.6%. The 2x P/S ratio is below its five-year average of 3x. The 9x P/E is below its five-year average of 25x. And the 2x P/B ratio is below its five-year average of 3.8x. A good company trading at a historically high yield and an attractive valuation is hard for me to resist.
There's one big caveat with McCormick. It is about to buy Unilever's (NYSE: UL) food business. It is a big deal for McCormick, noting that Unilever's food business is bigger than McCormick's. McCormick is taking a big risk and will have to add leverage to get the deal done. However, McCormick has successfully integrated other food businesses in recent years. And Unilever's food business, which largely consists of Hellmann's and Knorr, is very well run. This isn't a fixer-upper situation, is a good food company merging with another good food company. I think the risk/reward balance is weighted to reward.
Now is the time to act on McCormick
I've watched McCormick for years, but it has always been too expensive for me to buy. Good companies don't go on sale very often. And when they do, there's usually a reason. With a long-term horizon, I'm jumping on McCormick while I can, even though there's some uncertainty around the business today. Costco is a great company, but the stock is probably best left on the wishlist if you are, like me, a dividend investor with a value bias.
Should you buy stock in Costco Wholesale right now?
Before you buy stock in Costco Wholesale, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Costco Wholesale wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $418,761!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,195,804!*
Now, it’s worth noting Stock Advisor’s total average return is 918% — a market-crushing outperformance compared to 208% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
*Stock Advisor returns as of July 6, 2026.
Reuben Gregg Brewer has positions in McCormick and Unilever. The Motley Fool has positions in and recommends Costco Wholesale. The Motley Fool recommends McCormick and Unilever. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

When I Try to Imagine the Best Investment Opportunity for the Next 10 Years, Costco Stock Just Doesn't Make the Cut. That's Why I Keep Coming Back to This Stock.

Key Points
The stocks listed here pay between 2.6% and 4.9% in dividends.
These are large, recognizable businesses that have solid fundamentals.
Dividend stocks that have fallen to 52-week lows can be enticing options to buy. When share prices drop, that means the yield you're collecting rises, since it means it costs less to acquire a piece of the business, and thus, the dividend income represents a greater proportion of the money you invest. Plus, at a lower price, there's the potential to profit from a rise in price should the stock rally in the future.
Three dividend stocks that recently hit new lows that you may want to consider buying today include McDonald's (NYSE: MCD), AT&T (NYSE: T), and Unilever (NYSE: UL).
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McDonald's
Few companies in the world are as iconic as McDonald's. Its golden arches can be a welcome sight for travelers as the fast-food chain often represents a convenient and relatively low-cost option for a quick meal.
While prices have risen in recent years due to inflation, its restaurants still provide consumers with plenty of value, as evidenced by its continued growth. In the quarter ending March 31, McDonald's reported comparable sales growth of 3.8%, with performance broadly similar across international and domestic markets. It's a good sign of continually strong demand for its products.
McDonald's may not be a growth machine, but it is certainly a dependable and stable long-term investment. And, of course, let's not forget the dividend income you can generate from this investment. At 2.6%, its yield is more than double the S&P 500 average of 1%. The stock is down around 8% this year and recently hit a new 52-week low, but with a reasonable price-to-earnings (P/E) multiple of 23, it can be a great pick up today, as this is a top dividend stock you can comfortably hang on to for the long haul.
AT&T
Shares of AT&T have been falling recently as investors grow more concerned that SpaceX and its Starlink business may disrupt the broader telecom market. It's an issue that looks overblown, or at best, premature. Starlink is part of SpaceX's connectivity segment, which generated $11.4 billion in revenue last year. AT&T, by comparison, reported revenue that was 11 times that amount last year -- $125.6 billion.
AT&T is a top telecom provider, and while competition may chip away at some of its market share, the stock's recent decline represents a bit of an overreaction simply due to SpaceX gaining more attention of late as a result of its upcoming IPO. However, AT&T stock isn't exactly tumbling over a cliff; it's down around 9% for the year.
For dividend investors, this could be an opportune time to buy this low-volatility stock, as its yield is up around 4.9% right now. AT&T's stock is trading near its lows, and its valuation is enticing -- its P/E multiple is just seven.
Unilever
Top consumer brand Unilever is another dividend stock that's been struggling of late. Its shares are down 12% this year, making its decline the most significant on this list. The market has been concerned with the news that the company is looking to spin off its food business and the uncertainty that might bring.
While it might make the business smaller, Unilever sees it as an opportunity to be more of a pure play home and personal care company. That can help drive efficiency and allow the company to be more focused in its growth efforts. And although the food segment is a key one for Unilever, it was also its slowest-growing one in its most recent quarter, with management saying that "category conditions remained soft" in developed markets.
Unilever stock currently yields right around 4%, making it another excellent income stock to buy and hold. And with its price declining, the stock's valuation looks attractive, as it trades at a P/E ratio of just over 19.
Should you buy stock in McDonald's right now?
Before you buy stock in McDonald's, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and McDonald's wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $439,038!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,277,804!*
Now, it’s worth noting Stock Advisor’s total average return is 942% — a market-crushing outperformance compared to 206% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool recommends Unilever and recommends the following options: long January 2028 $320 calls on McDonald's and short January 2028 $340 calls on McDonald's. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.