Clorox Co. (NYSE: CLX) already has emerged from the coronavirus as a winner due to its namesake bleach products and wipes. Its share price of $185 creates a $23 billion market cap. With long-term debt of about $2.3 billion, the company should still have room to add growth brands selectively to its portfolio of products. Clorox stock was still up 20% year to date, so it may be the case that profit-taking could be expected before investors determine they have to have Clorox in their portfolios. It has a 2.3% dividend yield, and it is not even in the top-three among consumer products giants.
CVS Health Corp. (NYSE: CVS) has held up better than rival Walgreens, and its acquisition of Aetna is no longer a potential waste of capital, now that Medicare for All is dead on arrival. Trading at close to $59.00 a share, and with a $77 billion market cap, CVS stock is still down 24% from its highs and up “only” about 15% from its panic-selling lows in March. This should now be a somewhat defensive stock. It pays a 3.3% dividend yield that should still have ample coverage, based on past and expected normalized earnings.
Essential Utilities Inc. (NYSE: WTRG) is the former Aqua America after it merged with Peoples Gas in a $4.27 billion cash merger, which was financed with cash and debt. This is now a diversified utility with cheap access to natural gas and with the ability to still be valued as a water utility. The yield is better than some water utilities at 2.3%, and at close to 30 times expected earnings, the company will have to do what it can to make sure customers who did not have to pay for their gas and water for a while will begin to pay again. Its footprint extends to multiple states, and it has a $10 billion market cap. Essential was a $53 stock in mid-February, and it was last seen closer to $43.
Home Depot Inc. (NYSE: HD) was a “good economy winner” known for raising dividends and buying back stock, but with shares back under the $200, the stock has a dividend yield right at 3%, and Home Depot stock is still down about 20% from its highs. It should be expected that very few homes will be purchased in the coming months, even with rock bottom mortgage rates, but homeownership requires ongoing maintenance and care that will keep Home Depot shoppers going there for years.
Keurig Dr Pepper Inc. (NYSE: KDP) has a lot more than just Dr Pepper, Snapple and coffee going for it. This beverage leader has more than 100 beverage brands, and its 2.2% yield looks more than safe with its earnings and cash flow. The company had been paying down its post-merger debt, but a recent $1.5 billion offering came with a 3.2% coupon out to 2030 and a 3.8% coupon out to 2050. Its 2019 adjusted operating margin rose by 220 basis points to 26.0%. While its beverage brands should be safe in the recession, the big pull here for “after the recession” is that Keurig sales of coffee probably just added millions of more buyers. They are going to be working from home for years after the stay-at-home orders are lifted, and some of that cost likely will come right out of the pocket of Starbucks.