Coca-Cola's board of directors increased the dividend earlier this year in February, continuing a tremendous streak.
This beverage stock's dividend yield is more than double that of the S&P 500.
Coca-Cola's huge profits support rising dividend payouts in the future.
Given that Coca-Cola (NYSE: KO) has a presence in more than 200 countries and territories, with a whopping 2.2 billion servings of its products consumed daily, chances are that investors are certainly familiar with this industry-leading enterprise. The business has a powerful and well-known brand, with incredible reach.
While this beverage stock won't be a top choice for investors looking to achieve huge capital appreciation, it has other strengths, such as returning copious amounts of cash to shareholders. Coca-Cola is also a Dividend King. Here's how many shares of the company you'd need to own to make $10,000 in yearly dividends.
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Earlier this year in February, Coca-Cola's board of directors announced a quarterly dividend payout of $0.51 per share. It's hard to believe, but this was the 63rd straight year that the dividend was raised. Now that $2.04 per share is paid out per year, investors would need to own 4,902 shares to generate $10,000 in annual dividends.
For those investors who prioritize income in their portfolios, it's hard to beat Coca-Cola. The stock's dividend yield sits at 2.97% (as of Sept. 4). That's a much higher percentage than the S&P 500's average yield of 1.25%.
In the past decade, Coca-Cola's share price have climbed 75%. Even when you add in dividends, the beverage stock's total return comes up well short of the S&P 500. Because this is a mature company that isn't growing rapidly, investors shouldn't expect market-beating returns.
However, this business has true staying power, thanks to its strong brand presence and established industry dynamics. And with proven pricing power and third-party bottling and distribution arrangements, Coca-Cola is able to rake in substantial profits. This means that its dividend is likely to keep rising in the years ahead.
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Neil Patel has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.