PG vs. CL: Which Household Giant Deserves Your Retirement Dollars?

Procter & Gamble (NYSE:PG | PG Price Prediction) or Colgate-Palmolive (NYSE:CL): which one better fits an investor seeking income for retirement? Both just raised their dividends. Both keep beating estimates: P&G posted its 6th straight beat and Colgate its 5th straight beat. The checks they mail to shareholders still differ by a wide margin, and so do the reasons to own each one.

Yield and Income: P&G Pays the Bigger Check

P&G raised its quarterly dividend to $1.0885 from $1.0568. The increase amounts to roughly 3%. Colgate moved to $0.53 from $0.52, a raise of about 1.9%. P&G also yields more, at 2.61% against Colgate’s 2.15%.

Colgate covers its payout with more room to spare. Its 2025 dividends of $1.82 billion took about 50% of free cash flow. P&G’s fiscal 2026 dividends of $10.23 billion used about 68% of roughly $15.1 billion in free cash flow. That ratio still leaves P&G enough cash to plan more than $10B in dividends and ~$5B in buybacks for fiscal 2027. Colgate’s balance sheet has less buffer: shareholders’ equity stood at just $236M after years of buybacks.

Winner: P&G. It pays the higher yield, raised faster, and covers the payout well.

Growth Trajectory: Colgate Is Gaining Speed

Colgate raised its 2026 outlook at its last earnings report, and now guides for mid-single-digit Base Business EPS growth. Gross margin expanded 140bp to 61.5%, and Base Business EPS of $0.99 exceeded the $0.95 estimate.

P&G’s quarter was strong too: core EPS of $2.00 beat the $1.89 estimate, and organic sales rose 4%. Still, management held core EPS guidance at 0% to 3% growth because of a ~$1.4B after-tax commodity hit. Management put it this way: “The strength is real, but it won’t be a straight line.”

Investors are paying for Colgate’s faster growth. The stock rose 22.77% over the past year, while P&G gained 9.59%. Both now trade near 21 times forward earnings. Colgate’s main weak spot is North America, where organic sales fell 3.0%. Its CEO said “it won’t be a linear improvement” but promised sequential increases.

Winner: Colgate. Its guidance is rising while P&G’s stays flat.

Long-Term Track Record: P&G’s 136-Year Record Stands Alone

P&G has raised its dividend for 70 consecutive years and paid one for 136. Colgate’s streak of increases runs 63 consecutive years. Over the last decade, P&G’s quarterly payout grew about 63%, compared with roughly 39% at Colgate. The share price gap is wider still: P&G gained 142.98% over 10 years, against 66.97% for Colgate.

P&G’s market cap of about $373.4B is spread across five global segments. Colgate, at about $75.0B, leans heavily on oral care and pet food. It also took a $919M goodwill impairment on its Filorga skin care brand. That charge helps explain why Colgate trades at a trailing P/E of 37, compared with 24 for P&G.

Winner: P&G. It has grown the dividend faster, delivered bigger returns, and spreads its risk across a broader business.

Verdict: P&G Is the Retirement Stock

For retirees who live on their dividends, P&G wins two of three categories and takes the overall verdict. It pays more income today, has grown its dividend faster for a decade, and has the longest payment record in the group. Its fiscal 2027 plan to return $15 billion to shareholders shows how much cash the business throws off.

Colgate fits a different investor: someone still a decade or more from retirement who wants faster earnings growth and can live with a lower yield and a North American turnaround that isn’t finished. For income-focused investors, P&G offers the stronger dividend profile.

Two things are worth tracking next. P&G expects its commodity challenge to grow materially higher in Q2, which will test its pricing power. Colgate’s next earnings report will show whether North American volumes have finally started to recover.

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