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Highlights
- Coles shares up over 18% in 2025 so far
- Resilient performance in the consumer staples space
- Dividend appeal remains a key feature
Since the beginning of 2025, shares of Coles Group (ASX:COL) have gained a healthy 18.1%, drawing fresh interest from those looking at Australia's leading consumer-focused businesses. As one of the major supermarket chains, Coles continues to solidify its position within the ASX200, especially as demand for defensive sectors gains traction.
Coles was originally founded in 1914 and spent over a decade as a subsidiary of Wesfarmers before its independent listing in 2018. Now operating with a suite of brands such as Liquorland, First Choice Liquor, Vintage Cellars and flybuys, Coles commands around 28% of Australia’s grocery market, second only to Woolworths (ASX:WOW).
A Key Player Among ASX Dividend Stocks
Coles has long been a name among income-focused ASX dividend stocks due to its consistent dividend history. Over the past five years, its average annual yield has stood at 3.76%. For the 2024 financial year, the company delivered a dividend higher than its three-year average, suggesting that its shareholder returns have remained resilient despite macroeconomic uncertainties.
This consistency is what continues to place Coles in the spotlight on dividend-oriented platforms like this one: ASX dividend stocks.
Defensive Strength in Consumer Staples
Consumer staples companies such as Coles are often known for their resilience during downturns. Unlike discretionary sectors, staples like groceries and household necessities experience steadier demand across economic cycles. This makes Coles an appealing counterbalance within a diversified portfolio.
The broader S&P/ASX 200 Consumer Staples Index (ASX:XSJ) has returned 1.67% per annum over the last five years—significantly less than the broader S&P/ASX200's 8.45%. However, the sector’s strength lies in its stability and dependable cash flow, which are particularly attractive qualities when markets become volatile.
Understanding COL’s Current Valuation
Currently, Coles is offering a dividend yield of around 3.05%, below its 5-year average. This suggests that its share price has climbed faster than dividend payouts, a sign of improving investor sentiment. Importantly, last year’s dividend actually grew—underscoring a strengthening position rather than a yield decline due to payout cuts.
With its strong fundamentals, stable earnings, and defensive moat, Coles continues to maintain a steady position within the ASX300, serving as a long-term anchor stock for those interested in reliable income and lower volatility.
