Covered — barely, at a near-full payout. A 4.29% yield on a 98.82% trailing payout is covered on paper and nothing more: $0.21 a quarter, raised from $0.2075 in August 2026, but nearly every dollar of trailing earnings goes out as dividend. The yield is real, but there is no cushion — any earnings slip puts the rate itself in question.
Key risk: Near-full payout plus a pending takeover — a 98.82% payout leaves no cushion, and the announced Kimberly-Clark acquisition (signed November 2025, expected to close in the second half of 2026) means the standalone dividend policy may not survive the deal.
Changes if: Trailing earnings recover enough to pull the payout back toward 60%, or the dividend is cut or the acquisition closes. The payout ratio is the tripwire here.
- !Payout-coverage check: 98.82% trailing payout ratio — covered, but with almost nothing retained; any earnings slip threatens the rate.
- ✓Yield check: 4.29% indicated — $0.21/qtr × 4 at the $19.57 close on Oct. 23, 2026. Real, earned yield, not a special or a return of capital.
- ✓Dividend growth check: Raised every year since the 2023 Johnson & Johnson spin-off; the latest raise lifted the quarterly dividend from $0.2075 to $0.21 in August 2026.
What this grade doesn't say: It screens the dividend only — covered, real, compounding. It says nothing about valuation or price: a well-covered payer can still be overpriced, and its price can still fall.