The international company Croda (LSE:CRDA) is one of them FTSE100most reliable dividend stocks for decades. And after falling 75% from its highs, it is starting to show signs of a comeback.

For those who buy the stock today, the dividend yield is still 3.8%. So is the situation starting to improve? Should investors looking for passive income take advantage of this opportunity before it’s too slow?

Reliability

Reliability is an crucial factor for dividend investors. Anyone who wants to live off the income generated by a stock portfolio needs to be sure it will show up regularly.

There are never any guarantees, but some companies have a better track record than others. And specialty chemicals specialist Croda International is ranked number one among the best in the UK.

It has increased its dividend every year for 34 years. This is a period that includes the global financial crisis, the Covid-19 pandemic and much more.

What’s even more impressive is that Croda is actually quite a cyclical business. Demand for its products rises and falls as GDP growth rises and falls, which affects profits.

However, even during downturns, the company manages to return more cash to shareholders each year. And this is extremely valuable for income investors.

Inventories are sinking as high inventory levels have weighed on demand over the past few years. But the company has already taken some gigantic steps and things are just starting to improve.

Periodicity

Through a series of acquisitions and divestitures, Croda has tried to reduce the cyclicality of its business. Much of this is due to the sale of industrial units to focus on life sciences and consumer care.

The life sciences section covers crop treatments that make seeds more resistant to drought and pests. It is worth noting that agriculture can be cyclical due to fluctuations in crop prices.

Importantly, however, Croda seed coats are relatively resistant to economic downturns. When things get tough, farmers rely on them even more to protect their crops.

A gigantic risk for the company at the moment is that the dividend has not been covered by profit for several years. This means he was withdrawing more than he was earning.

This can’t last forever. There is reason for optimism, however, as management recently signaled that the extended period of high inventories would end in 2026.

Investors have been waiting for this news. And if the boost in volumes is accompanied by a corresponding boost in margins, things could start to look very keen.

What to pay attention to

Croda’s next report is scheduled for February 24 and should include an update on the dividend. If the news is positive – particularly in terms of demand recovery – there could be a recovery in share prices.

I think this is a good time to consider buying shares. It is trading at an extremely high dividend yield, has an excellent track record, and appears to be showing signs of recovery.