I’ve been covering stocks for five years, and there are very few excellent long-term businesses that I have neglected to mention at least once. After noting how Cisco investors need to make peace with a management team that feeds at the trough due to the detriment of shareholders, I want to talk about a company that is very good at keeping compensation reasonable while also delivering exceptional value to shareholders: Sherwin-Williams (SHW).
Even though Sherwin Williams has been raising its dividend for 38 years, and sells paints and automotive coatings that are well known to consumers, you rarely hear it mentioned in discussions of ideal long-term investments. I suspect this is because the starting dividend yield frequently hovers around the 1% mark. A lot of people who get interested in owning large, established firms want to see at least 3% of their investment come right back at them as a share of the profits distributed to them in the first year from their investment.