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.
Medical Properties Trust, Inc.: Finally, a Safe High-Yield Stock
You Can Trust This 6% Yield I reject most of the high-yield stocks that cross my desk. Readers love big payouts. Most companies, however, can’t deliver both safety and a high yield. But once in a while, I get a.
Get Ready for a Distribution Hike From a Stock That Already Yields 11%
A Rare Find in the Stock Market In today’s stock market, what could be better than a safe yield of over 10%? The answer: a double-digit yielder that keeps growing its payout. I know, in an era where most companies.
New Device Could Solve the Opioid Crisis and Pay Dividends
Investing in the War on Opioids Opioids kill hundreds of Americans each day. I probably don’t need to remind you; you can see the signs of a crisis in many areas of the U.S., including overstretched emergency rooms and addicts.
ABR Stock: This 10.3% Yielder Is Delivering a Bonus Check
Shareholders Getting a Year-End Bonus In the current market environment, few things are better than a bonus check for equity investors. Of course, I’m talking about special dividends, which are one-time payments from companies to their shareholders. Given what’s been.
While Not a Market Favorite, This 6.6% Yielder Deserves a Look
A Top Dividend Stock You Likely Haven’t Considered Betting on out-of-favor stocks can be risky. But if you are talking about the beaten-down shares of Tanger Factory Outlet Centers Inc. (NYSE:SKT), then even the most risk-averse income investor should take.
Ecolab Inc. Delivers a Christmas Gift to Dividend Investors
A Growing, Secure Payout From ECL Stock Another year in the books and one company just topped it off with a fat dividend increase for shareholders. As regular readers know, the mandate of our publication is to cover stocks that.
EQM Stock: This 10.1% Yield Still Has Room to Grow
1 High-Yield Stock to Think About Generally speaking, high-yield stocks are not the safest bets. But for those who are willing to do the research, it’s still possible to find safe and rising income plays that also offer oversized payouts.
BP Midstream Partners LP: Can This 7.5% Yielder Keep Gushing Dividends?
Finally, a Safe 7.5% Yield I don’t trust most high-yield stocks. In fact, I toss out most of the big payouts that cross my desk. Most companies just can’t offer both a high yield and a reasonable degree of dividend.
This Cheap Monthly Dividend Stock Offers a 9.1% Yield
1 Monthly Dividend Stock to Think About If you want to find good deals this holiday season, forget the department stores. Instead, go to the stock market. Due to the lackluster performance of U.S. equities over the past few months,.
This Quiet Market Niche Pays Yields Up to 23%
Buy Stocks for 80 Cents on the Dollar I love buying a buck for a quarter. Working is hard, but free money is nice. So when I see a real dollar selling for a discount, I get fired up. Of.
