It’s been almost a year since I was fired Unilever (LSE: ULVR) from my personal self-invested pension and I can’t say I missed it. I just noticed that his stock will retire ex-dividend on Thursday (February 26). Any investor considering FTSE100 you may be tempted to buy shares early to secure your next payday. So is it worth buying today?
On February 12, Unilever declared a quarterly interim dividend of 46.64 eurocents (40.52 pence) per share. Anyone who purchases the stock before the ex-dividend date will receive it on April 10. It’s not the flashiest earnings company on the FTSE 100. The current trailing yield is around 3.1%. However, management has a pretty good track record of increasing shareholder payouts over time.
Unilever has increased shareholder payouts every year this millennium, except for the financial crisis in 2009 and the suspension in 2022 and 2023, when the dividend remained at 170.72 eurocents. It has since risen to 175.88 cents in 2024 and then 182.48 cents in 2025. The yield is not great, but the income stream appears resilient. However, as always, there are no guarantees.
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Share price is another matter. Once a decent performer, he has become more hard in recent years. The stock is up 9% in one year and 22% in five years. Taking into account dividends, this is respectable but unexciting.
Why did I sell? I argued then that Unilever “Extensive operations led to lack of concentration”. She tried to refine her business by focusing on 30 “power brands,” but progress was patchy. I also wondered whether a high price-to-earnings (P/E) ratio of around 24 left much room for the stock to rise unless sales and earnings accelerate significantly.
The stock has belatedly recovered, jumping 12.7% over the past month. They were improved by the full-year results on February 12, the first for Unilever since the separation of the ice cream division.
Underlying sales growth in 2025 was 3.5%, in line with forecasts. Not very eye-catching, although momentum picked up in the fourth quarter. Full-year profit rose 66% to €9.47 billion, but was flattered by a €3.79 billion gain from the split of the ice cream sector. Profit from continuing operations increased by a more modest 4.6% to €5.68 billion. The €1.5 billion share buyback was welcome.
Slightly lower P/E
Unilever’s valuation looks a bit less demanding today, with the P/E falling just below 20. However, I’m not entirely thrilled with the prospects. Unilever expects 2026 sales growth at the lower end of its target range of 4% to 6%, reflecting softer market conditions. Inflation may be falling, but the cost of living squeeze hasn’t gone away.
As a defensive company, Unilever has probably done its job in uncertain times. It still has an impressive portfolio of everyday brands and is pushing harder for savings, cutting £670m last year while focusing on more profitable emerging markets.
Last week, Berenberg analysts announced that the group had completed its transformation into “a simpler, more flexible, faster growing and more profitable business”. However, they still downgraded the stock from Buy to Hold.
I think Unilever is worth considering for investors looking for consistent income and growth. However, personally I see more exhilarating opportunities in the FTSE 100 and will be targeting those instead.
