Procter & Gamble Has Raised Its Dividend for 70 Years. These 2 Stocks Share Its Advantage
Raising dividends through two recessions takes more than a good brand name. Three companies with streaks stretching back decades show exactly what separates a payout that survives a crisis from one that quietly disappears.
A retirement income stream has two jobs. It has to arrive every quarter, and it has to grow faster than the grocery bill, whatever the economy is doing. Dividend Kings are companies that have raised their payouts for at least 50 straight years, so they have the longest public record of doing both. The three names below raised their dividends through the 2008 financial crisis and the 2020 pandemic recession, and all three pay for those dividends out of free cash flow rather than borrowed money. The longest streak in the group belongs to Procter & Gamble (NYSE:PG | PG Price Prediction), which just completed its 70th consecutive annual dividend increase.
Procter & Gamble: Everyday Staples Behind the Longest Streak
P&G sells things households keep buying in a recession: Tide, Pampers, Gillette, Crest, Charmin and Dawn. At $158.42, its annualized forward dividend of $4.354 per share works out to a yield of about 2.75%. That yield is modest. P&G’s strength is how well the payment is covered.
P&G produced $15.835 billion of free cash flow in fiscal 2026, up 12.74%, on operating cash flow of $19.556 billion. Dividends for the year came to over $10 billion, which is roughly 63% of free cash flow. The forward dividend also equals about 63% of fiscal 2026 core EPS of $6.89, so roughly a third of earnings stays in the business as a cushion. Adjusted free cash flow productivity was 100%, meaning reported profits turned fully into cash. The balance sheet holds $9.94 billion in cash against $54.31 billion of shareholders’ equity.
The track record has been tested in bad markets. The quarterly payout rose from $0.40 in 2008 to $0.44 in 2009 during the financial crisis. In 2020 it went from $0.7459 to $0.7907 with the April payment, then rose to $0.8698 in 2021. The latest raise took the quarterly payment from $1.0568 to $1.0885. That makes this the company’s 136th consecutive year of dividend payments.
Bull case: For fiscal 2027, management plans over $10 billion in dividends and approximately $5 billion in buybacks. With a beta of 0.377, the stock has historically moved much less than the broader market, which is the kind of steadiness retirees want. CEO Shailesh Jejurikar said on the fiscal fourth-quarter call that P&G “continued a long-term record of returning high levels of cash to shareholders.”
Caveat: Management expects about $1 billion after tax in higher raw material, energy and transportation costs in fiscal 2027. Its core EPS guidance range is $6.89 to $7.11, so expect the next raise to stay small.
Johnson & Johnson: AAA-Rated Cash Flow Feeding a Growing Payout
Johnson & Johnson (NYSE:JNJ) pays a forward dividend of $5.36 per share. At $255.87, that is a yield of roughly 2.09%, the lowest of the three. The yield has shrunk partly because the stock rose 36.18% over the past year. Existing holders got that gain on top of their income. New buyers get less income per dollar invested.
On coverage, J&J is the most comfortable name in the group. Management reaffirmed full-year free cash flow guidance of approximately $21 billion, including more than $6 billion in the third quarter alone. At the current rate, the dividend costs about $12.9 billion a year, or roughly 62% of that free cash flow. It also equals about 48% of the $11.10 midpoint of adjusted EPS guidance. The company ended the quarter with approximately $17 billion of cash and marketable securities against approximately $45 billion of debt. It is also one of only two U.S.-based companies with a AAA credit rating.
J&J’s most recent raise, from $1.30 to $1.34 a quarter (3.1%), was its 64th consecutive year of increases. It kept raising during the financial crisis, from $0.415 to $0.46 in 2008 and then to $0.49 in 2009. In the middle of the 2020 recession it raised again, from $0.95 to $1.01.
Bull case: The drug portfolio is growing fast enough to fund future raises. DARZALEX sales reached $4.21 billion in the second quarter, up 18.9%, and TREMFYA climbed 72.5%. CFO Joe Wolk lists the dividend among the company’s capital priorities, describing an approach focused on “accelerating future innovation, increasing our annual dividend, and strengthening our pipeline.”
Caveat: Biosimilar competition is eroding STELARA fast. Second-quarter sales were $740 million, down 55.2%, which cut roughly 760 bps from Innovative Medicine growth. Newer drugs have to keep filling that gap.
PepsiCo: Highest Yield in the Group, Backed by Global Snacks
PepsiCo (NASDAQ:PEP) pays the most income of the three. Its annualized dividend of $5.92 per share yields about 4.50% at $131.50. The stock has fallen 10.38% over the past year, so new buyers lock in a higher starting yield than they would have a year ago.
The coverage cushion is thinner than at P&G or J&J. Over the trailing 12 months PepsiCo paid $5.805 per share in dividends against EPS of $7.95, a payout ratio near 73%. Its free cash flow yield of 4.39% is about level with its dividend yield, so cash generation covers the payout with little to spare. The plan for 2026 calls for $7.9B in dividends and only $1.0B in buybacks, which shows the dividend gets paid before buybacks. Debt is manageable, with net debt at 2.31 times EBITDA and interest coverage of 12.03x.
PepsiCo says this year marked its 54th consecutive annual dividend increase, and it has paid quarterly dividends since 1965. The latest raise lifted the quarterly payment from $1.4225 to $1.48. During the financial crisis the payout went from $0.375 to $0.425 in 2008 and to $0.45 in 2009. In 2020 it rose from $0.955 to $1.0225.
Bull case: International growth is carrying the company. Third-quarter revenue rose 5.6% to $25.27B, and operating income jumped 19.4%. Latin America Foods grew 14% and EMEA 8%. CEO Ramon Laguarta said the “international business is becoming a very scaled part of our business and profit accretive.” A company earning more from Lay’s, Doritos and Gatorade outside the U.S. depends less on any single economy.
Caveat: North American snacks are weak. Core operating profit at PepsiCo Foods North America fell 12%, and management cut its 2026 core EPS growth forecast to +2.5% to +3.5%, down from +5–7%. Because coverage is already tight, keep an eye on whether cost cuts restore those margins.
Three Ways to Collect a Paycheck That Keeps Growing
All three companies raised their dividends in 2008, 2009 and 2020, so their records hold up through recessions as well as good years. J&J offers the widest coverage and a AAA balance sheet. P&G pairs the longest streak with free cash flow that grew by double digits last year. PepsiCo pays the highest yield in exchange for a thinner cushion, so the thing to track is whether its North American margins recover. If you want a wider shortlist screened the same way, we ranked ten Dividend Kings by valuation right now in a free report you can grab here.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
