For retirees, I recommend you choose consumer sector stocks with well-established brands, reliable earnings, and a history of paying regular dividends.
They might not be as exciting as Amazon, but these companies can add a reliable income stream to your portfolio while also providing upside.
For example, in the Cabot Dividend Investor portfolio, we currently have a 40% total return in Church & Dwight (CHD), the company that owns the Arm & Hammer, OxiClean and Trojan brands, as well as some smaller, faster-growing brands. But even after a 35% climb in 18 months, Church & Dwight still looks strong and poised for further gains. Analysts are predicting 8% revenue growth this year and 9% growth next year.
And even when consumers start pocketing their dollars again, CHD will continue rewarding investors with regular dividends—the company has increased its dividend by 11% per year on average since 2009. I currently have CHD rated Buy in the Dividend Investor portfolio for investors who want both stock price appreciation and dividend growth.