Please pay no attention to anything you read here as it is just the rantings of a mad man with rotting teeth.
I love Colgate.
It's a great company. They make wonderful products. A true example of a spectacular, profitable, and well-run American company.
Arm & Hammer is great too. Pepsodent. whatever else, I don't really care. I own stock in all of them. I am invested in the toothpaste industry. If the toothpaste section of the consumer staples industry does well, I make money.
And boy, do they make money.
They make so much money that they give me money just for owning a part of the company!
It's such a great deal I can't even.
I stopped using toothpaste in college.
That doesn't matter
There are a lot of wonderful, spectacular companies out there that reward you for owning a part of them. The management team gracefully decided to give us shareholders a quarterly payout.
Of course, they are all owners as well so they are basically giving a bunch of money to themselves, but I get my fair share of the cut.
My effective tax rate might be higher because my ratio of W2 to qualified dividend income is higher than theirs, but one day I too plan to make qualified dividends my main source of income so that I may reap the same benefit.
Tax laws may change to close this "loophole" that the rich benefit from tremendously, but they have huge influence over the clowns that push tax laws so I'm sure another loophole will pop up that will take the most people a long time to figure out and get mad about.
Anyway, Colgate. Great company. Tyson, Merck, Disney - all great. Couldn't ask for better results from these guys.
But why haven't I used toothpaste in over seven years?
That's a long time.
What's going on?
Am I just that really stubborn guy that won't give up on getting the last drop of toothpaste out of the toothpaste tube?
I've just been brushing without toothpaste. Sometimes not even brushing, but using one of those handy-dandy flossers.
But don't be alarmed! My last checkup went very well.
Not only did I have no cavities, my dentist was surprised at how clean my teeth were because I hadn't visited her for three years.
She complimented me on my toothbrushing habits because she scraped off less plaque from my teeth than she usually does. And most
customers patients visit the dentist twice a year.
She even had a Colgate ad in her office. When I saw it, I pulled out my phone and bought five shares of CL. When I complimented her on the ad placement, I was amazed. She said,
That's not an ad, it's an infographic about periodontitis! You have to make sure you brush with toothpaste every day to avoid getting it.
I whipped out my phone mid-cleaning and bought another ten shares of CL. I'm sure close to all of her customers use toothpaste, with a preference for Colgate.
What about you, do you use toothpaste? What kind?
Man, it's basic knowledge to brush your teeth with toothpaste. Tell people you don't use toothpaste and they'll look at you funny and say, "GROSS!"
Trust me, I know.
But that doesn't bother me. My teeth are in great shape.
Everyone I know buys toothpaste. You use toothpaste. Everyone you know buys toothpaste. So many people buy toothpaste. People even make it a point to buy toothpaste to donate to people in need!
The non-profit organization Project Healthy Smile does just that:
Whoa, do you see what they're holding?
I just found out about Project Healthy Smile and the video on their front page convinced me to buy another twenty shares of CL.
Thank you to all the people spending their time and money to provide me with steady dividend income.
Colgate's marketing department is killing it. They have so many people buying their toothpaste and other products that they have run out of ways to put maney back into their business, so they just give out the over-the-top profits to shareholders like me!
Shit, I bet even Bill Gates buys toothpaste.
Speaking of Bill, I really like what he's doing with his foundation in the name of trying to eradicate a bunch of diseases because it's really helping my holdings in the pharmeceutical sector. We have a very similar vision of the future.
So why don't I use toothpaste?
It might be a weird concept to wrap your brain around. It also goes against one of the most important investment rules: buy stock in companies that you believe in.
I obviously don't believe in toothpaste, so what the hell? Why would I keep on buying shares of Colgate and others in the toothpaste industry?
Back in college, I looked at the toothpaste carton and read the thing. Here's what it said:
Wait, why does it say "Do not swallow"?
I had read it before, but never thought much of it for some reason. Why as it harmful if swallowed? And why should children use a specially formulated children's toothpaste?
I never cared enough to go find the answers to those questions until that day I was feeling more inquisitive than usual.
Turns out that fluoride, one of the active ingretients in toothpaste is a deadly neurotoxin.1
Ah, that makes sense why they don't want children to swallow it. It tastes so yummy, parents might allow their kids to swallow it after a good job of brushing. If it's not stated, how would they know not to? If I were a parent, I would think that toothpaste would be safe to swallow because you put it in your mouth. And it tastes so good...
Can't have that be a hindrance to your business. If people unknowingly swallowed something that made them sick, Colgate might have a lawsuit on their hands.2 That will cost a whole bunch of money and reduce the amount of dividends they can pay me, so I'm glad they put a warning on the tube.
The downside of my research was that I learned that I may have a mild case of dental fluorosis from ingesting too much fluoride as a kid, as you can see from several spots of discoloration on my teeth.
So I stopped using it. It didn't make any sense to keep using it now that I knew it was bad for you.
I tried some other things in place of it, even trying oil pulling at some point, but ended up just brushing regularly without any toothpaste.
And that worked just fine.
I haven't had any cavities since quitting toothpaste.
The only part I miss is the minty-fresh feeling you get after brushing, but at least I can use the money I don't spend on toothpaste to buy CL.
And CL pays dividends!
It was weird telling people why I stopped using toothpaste when asked about it. Mainly for them, because it made perfect sense to me: if you find out that you're doing something harmful. you would stop doing it.
People didn't really seem to follow that simple logic. Even after I sent them links to the evidence in research that won me over.
Everybody I've told still buys toothpaste, so I continue to buy Colgate stock. I think my dividends are pretty safe.
Just like my teeth.
At the time of this writing, Colgate-Palmolive Company (CL) is trading at 63.56, just above its 52-week low of 61.28, making its current dividend yield a hefty 2.6%. Recent stock performance has not been that great, as CL is down 16% over the last year, but to me this represents a good buying opportunity to lock in a solid dividend. For the past five years, CL has been steadily raising its dividend. That trend should trend will continue, unless people become wise to the toothpaste scheme.
I think that's pretty unlikely.
I am/we are long CL and, depending on your beliefs on toothpaste, may initiate trades to acquire more shares of CL.
I wrote this article myself, and it expresses only my own opinions. I am not receiving compensation for it, but I am receiving dividend income from being long CL. I have no business relationship with any company whose stock is mentioned in this article.
1. Fluoride may not have been classified as a neurotoxin until 2014. Although, the warning had been on toothpaste tubes as long as I can remember, and I can remember at least until elementary school. But it must have been known prior to 2014 that toothpaste was harmful - especially to Colgate - because why else would they have a warning on their product? (go back)
2. Like the one they had in 1996. Wait, all the way back in 1996? I thought Fluoride was just classified as a neurotoxin. Anyway, it was a paltry sum. Barely enough to affect my payout.