Unilever (NYSE:UL, NYSE:UN) appears poised for a new future under a simplified business framework. The provider of household brands such as Lipton tea, Dove soap, and Ben & Jerry’s ice cream wants to redefine its corporate structure. Although this will leave one Unilever stock instead of two, I see no other differences easily visible to shareholders.

Whether dealing with one Unilever stock or two, investors still need to evaluate this equity based on financial metrics and business conditions.

Ending the Dual Structure

The Anglo-Dutch personal care product and packaged food company has operated dual headquarters in both London and Rotterdam, Netherlands. It now plans to redefine itself as an entity based solely in Rotterdam.

Political factors could be driving this move and the plan has drawn the ire of some of in the UK as many believe Brexit is at the root of the decision, but that isn’t necessarily the case.

The company also fought off a takeover attempt from Kraft Heinz (NYSE:KHC) in 2017, which led to some infighting between the UK and the Netherlands. Another factor involves takeovers and their tax consequences. If Unilever wants to buy a company in North America, paying for the deal with both UN and UL stock exposes the company to increased taxation.

Expect Little Change

Whatever the reason, if approved, shareholders of both UL stock and UN stock would receive one share in the New Unilever NV for every share they currently own. This new Unilever stock would begin trading on Dec. 24.

The equity would also continue to trade in Amsterdam, London, and New York. Moreover, it will maintain an “Anglo-Dutch” identity as two of three divisions will base their headquarters in Britain.

From the perspective of American shareholders, they will deal with one class of Unilever stock instead of two. Unilever may find it easier to acquire companies. However, I see little that would change the buy, sell, or hold proposition of Unilever stock.

Unilever Still Is Unilever

No matter how Unilever chooses to present itself, business conditions remain the same.

With regard to personal care products, it remains a no-moat competitor of companies like Procter & Gamble (NYSE:PG) and Colgate-Palmolive (NYSE:CL).

Its food division deals with an equally thin moat in its competition with firms such as General Mills (NYSE:GIS) and Kraft Heinz. In both arenas, none of these companies can rely on limited shelf space to curtail competition from smaller peers.

For this reason, I would personally avoid stocks centered around packaged food or personal care products.

Still, if one has to own a stock in these sectors, I prefer Unilever. Over the last 10 years, stock price growth has only lagged the S&P 500 by a modest amount.

Also, UL stock has seen less revenue and profit decline over the last few years than many of its peers. Analysts also predict an average profit growth rate of 6.8% per year over the next five years.

The Unilever stock dividend also provides a nice benefit. When measured in euro cents, investors see annual dividend increases. Currency exchange rates can lead to adjustments, so American stockholders will not always receive that increase. Still, the dividend will rise for everyone over time.

For 2018, it pays 38.72 euro cents (45 cents) per share every quarter. This amounts to a yield of just over 3.4%.

The Bottom Line on Unilever Stock

Investors can easily to adjust to a world of only one Unilever, but they should remain focused on financial metrics and business conditions.

The decision to trade as one stock stands as a political decision that will have little visible effects on the average investor. While it could make activities such as buyouts easier, investors need to keep their eye on factors such as valuation, profit growth, and market conditions.

In my view, Unilever performed well under such conditions. Despite the no-moat status of most of its products, the company has generally maintained revenue, income, and dividend growth despite market conditions.

I prefer stocks which benefit from more of a moat. Still, if I had to buy an equity involved with packaged food or personal care products, I would choose Unilever, regardless of whether it trades as two stocks or as one.

As of this writing, Will Healy did not hold a position in any of the aforementioned stocks. You can follow Will on Twitter at @HealyWriting.