Shares of Coca-Cola (NYSE:KO), Procter & Gamble (NYSE:PG), and Colgate-Palmolive (NYSE:CL) have reached 52-week highs following the midterm election results, driven by investor demand for stability amid political uncertainty. These companies, known as Dividend Kings for their long histories of annual dividend increases, offer reliable earnings and dividends, making them attractive in volatile markets.
Coca-Cola's latest quarterly results showed strong performance, with revenue growing 7% and earnings per share (EPS) surging 11%. The company raised its full-year outlook, expecting at least 11% comparable EPS growth. However, its share price surged to about $96, valuing it at nearly 29x earnings, a premium compared to the S&P 500's 23.5x.
Procter & Gamble faced cost and demand headwinds, with net sales growing just 4% and core EPS rising 1% in its fiscal 2027 first quarter. Despite these challenges, its stock price reached over $167, trading at nearly 24x earnings. Colgate-Palmolive reported better growth, with net sales up 4.6% and EPS increasing 7%, but its stock now trades at more than 25x earnings.
While these companies are strong businesses with long dividend histories, their premium valuations leave little room for attractive future returns. Investors may want to wait for better buying opportunities rather than chasing these stocks at their current highs.