Monday, October 7, 2013

Which Popular Dividend Growth Stocks Are 'Always' Overvalued? [PepsiCo, Inc., The Clorox Co, Paychex, Inc.] - Seeking Alpha

Which Popular Dividend Growth Stocks Are 'Always' Overvalued? [PepsiCo, Inc., The Clorox Co, Paychex, Inc.] - Seeking Alpha: I have noticed a couple of themes emerging in dividend articles over the past year. One theme revolves around valuation, with some suggesting that dividend stocks were in a bubble or significantly overvalued. Another theme has centered on "high quality" companies, and whether investors need sometimes to "pay up" for quality.

Putting the two themes together very recently, there has been discussion about Coca-Cola (KO) being a high quality company that never seems not to be overvalued. In the course of those discussions, it became clear that many feel that KO "always" trades at a premium valuation, so if you want to own it, you might as well accept that you'll need to pay up for it.

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