Dividend Stocks
Stocks that provide dividends are an excellent way to build long-term wealth. Not only do dividends provide investors with regular income, but dividend stocks can also help investors weather market volatility. How? Whether the markets are going up, down, or sideways, dividends provide investors with a steady income stream.
Having said that, while dividends are usually paid out quarterly, at the discretion of the company’s board of directors, they can be raised, cut, or eliminated.
Not all dividend stocks are created equal. As a result, there are a number of factors investors need to consider when looking at dividend stocks.
Dividend yield is one of the most important factors to consider when investing in dividend stocks. It might be tempting to just invest in a stock with the highest dividend yield, but there is a risk/reward trade off when it comes to dividend-yielding stocks—the higher the yield, the greater the risk.
Stocks that provide an annual dividend of 10% or more tend to be very risky. Because they are risky, there is a greater chance the dividend could be cut—or worse, the share price could plummet. This means investors lose out on dividend growth and capital appreciation.
History is another important factor to consider. Look for stable companies that have a long history (five, 10, or even 25+ years) of both paying an annual dividend and increasing that dividend annually. Those stocks that offer annual dividend growth as part of their corporate culture are more likely to continue that trend.
The best way to determine whether or not a company can continue to provide an annual dividend and raise its yield is to look at the company’s free cash flow. Free cash flow is the amount of free cash, or money left over after it pays for operations and necessary capital expenditures. The more money a company has in the bank, the greater the chances are that it can sustain or increase its high dividend yield.
Can You Trust This Real Estate Company’s 7.1% Yield?
Finally, a Safe High-Yield Stock Dividend investors treat high-yield stocks like children treat cookies: they can’t get enough. High-yield stocks generally represent low-quality businesses. Like sweet treats, the adult in all of us needs to avoid these temptations. But once.
Union Pacific Corporation Gives Shareholders a Big Pay Raise
Union Pacific Corporation Hikes Dividend 10%. Are More Hikes Coming? Wall Street has fretted this summer over trade tensions, a looming business slowdown, and a possible war with Iran. But Union Pacific Corporation (NYSE:UNP), it appears, may have missed the.
GasLog Partners LP: Earn a Yield Higher Than 11.3%?
Looking for Ultra-High-Yielding Stocks? Read This In today’s market, most investors would be thrilled to earn an annual dividend yield of 11.3%. But with this particular stock, there’s a decent chance that investors will earn an even higher yield on.
Altria Group Inc: Altria Stock’s 7% Yield Deserves a Serious Look
Beaten-Down Altria Stock Still Paying Dividends Investors once considered shares of Altria Group Inc (NYSE:MO) to be a safe, reliable investment. But no longer. For decades, the cigarette giant has navigated new regulations, higher taxes, and declining smoking rates. Now.
Alliance Resource Partners, L.P.: This High Yield Stock Now Pays 12.6%
This High-Yield Stock Looks Interesting To income investors, few things look more attractive than a double-digit yielder. The average dividend yield of companies in the S&P 500 index is a measly 1.85% at the moment. So if an investor can.
Walt Disney Co Earnings: Will Disney Stock Increase Its Dividend in 2019?
Disney Stock Delivering Big Returns Thirty-three percent. That’s how much Walt Disney Co (NYSE:DIS) stock has gone up since the beginning of this year. For a giant company commanding over $250.0 billion of market capitalization, that was quite a rally..
McDonald’s Stock: Time to Bet on the “Steve Jobs of Fast Food”
“Steve Jobs of Fast Food” Sends McDonald’s Stock Soaring When investors think of innovative CEOs, they probably mention tech titans like Elon Musk, Steve Jobs, and Jeff Bezos. Maybe they need to think of burgers and fries. Last month, McDonald’s.
Main Street Capital Corporation: Finally, A Safe High-Yield Stock
Main Street Capital Corporation Now Pays 7% I usually avoid high-yield stocks, and for good reason. Each day, I screen the market for new investment ideas. And with a few mouse clicks, you can pull up dozens of high-yield securities..
Microsoft Corporation: One More Reason to Check Out This Soaring Stock
Microsoft Stock Delivering Huge Returns If you’ve been following financial news lately, you’ll likely have come across Microsoft Corporation (NASDAQ:MSFT) stock in the headlines. MSFT stock has been trending up for nearly a decade, and thanks to the latest earnings.
High-Yield Stocks: Collect a 13.1% Payout From This “Alternative Bank”
“Alternative Banks” Make for Great High-Yield Stocks Income hunters searching for high-yield stocks should give this quiet industry a second look: “alternative banks.” My colleague Jing Pan coined the term to describe the growing industry officially known as mortgage real.
