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3 dividend stocks that could pay you for the rest of your life

There’s a lot to be said for investing in dividend stocks. They can provide an income stream or a high total return from reinvesting the dividends. Furthermore, there’s good reason to be snapping them up right now. Here are three I’d be happy to buy and hold for decades.

Global giant

Have you got a jar of Marmite, Bovril or Colman’s mustard in your food cupboard? PG Tips in your tea caddy? Hellmann’s mayonnaise in your fridge? Ben & Jerry’s or Magnum ice cream in your freezer? Persil washing powder or a Cif cleaner under your kitchen sink? Domestos, Dove soap or TRESemmé shampoo in your bathroom?

These are just a few of over 400 brands owned by FTSE 100 Anglo-Dutch consumer goods giant Unilever  (LSE: ULVR). It owns some of the best known and biggest selling household brands in the world, including 12 that have sales of more than €1bn a year. On any given day, 2.5bn people around the world use Unilever products.

The group is a cash-generating machine and is of such a size it can easily buy other blue-ribbon brands, if they become available. For example, earlier this month, it announced the €3.3bn acquisition of Horlicks and other health food drinks in India, Bangladesh and 20 other predominantly Asian markets from GlaxoSmithKline.

I view a rating of a little over 20 times calendar 2018 forecast earnings as excellent value for this world-class business. And I expect years of continued dividend growth from an initial yield of 3.2%.

Emerging markets story

Mid-cap PZ Cussons  (LSE: PZC) can’t match Unilever for global spread, nor does it own any brands that generate sales of more than €1bn a year. Total sales for its current financial year (ending May 2019) are forecast to be around £740m. However, it does operate in a fair number of countries, including a notable presence in emerging markets. And it owns some very decent brands, including Imperial Leather, Carex and Original Source.

Growth has been checked in recent years by a challenging economic backdrop in Nigeria (one of its most significant markets). However, I believe the story of increasing population and affluence in emerging markets remains intact, and bodes well for the company’s long-term prospects.

A rating of 16 times forecast earnings for its current financial year is cheap by historical standards and a prospective dividend yield of 3.9% is well above its historical average. With earnings and dividend growth forecast to resume in the company’s next financial year, I see great value here for long-term investors.

Venerable UK business

Brewer and pubs group Fuller, Smith & Turner (LSE: FSTA) is a UK-focused business. Its estate, which includes many landmark houses, is concentrated in London and the south east. Its positioning in and around one of the world’s most vibrant capital cities has enabled the business to thrive since its foundation in the mid-19th century.

Remarkably, descendants of the founders remain significant shareholders. And there are Fullers and Turners on the board of directors, ensuring the business continues to be conservatively stewarded with a long-term perspective. The company has a terrific record of annual dividend growth, putting many FTSE 100 firms to shame.

Trading on 14 times forecast earnings for its current financial year (ending March 2019), and with a prospective 2.3% yield, I see this is another great-value dividend stock that could pay you for the rest of your life.

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G A Chester has no position in any of the shares mentioned. The Motley Fool UK owns shares of and has recommended GlaxoSmithKline and Unilever. The Motley Fool UK owns shares of PZ Cussons. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.