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.
This “Cash Cow” Dividend Stock Yields 10.8%
Milk This Stock for a 10.8% Yield If you’re searching for safe, large yields, this niche of dividend stocks may be worth a second look: cash cows. In business jargon, cash cows amount to mature operations. Because these firms have.
EPD Stock: This 6.9% Yielder Is About to Raise Its Payout Again
Collect Rising Dividends from a Beaten-Down Industry Every income investor wants to own dividend growth stocks. As a result, companies with an impressive track record of raising their dividends have been highly sought after. And when investors bid up their.
Here’s What Nike Inc’s Earnings Report Means for Dividend Investors
Nike Stock Returning Cash to Investors “Given its rock-solid business, improving earnings, and low payout ratio, I expect the company to announce a double-digit increase to its quarterly dividend rate in the next week or two.” That’s what I told.
Will Apple Inc. Increase Its Dividend in 2018?
AAPL Stock Dividend Forecast With Apple Inc. (NASDAQ:AAPL) stock soaring more than 25% over the past year, the company’s 1.44% dividend yield may not seem like much. But note this: with consistent dividend increases, investors who purchase Apple stock today.
3 Top Mortgage REITs Yielding Up to 13.5%
Tiny Niche Yields Up to 13.5% Struggling with low interest rates? You’re not alone. Millions of retirees have seen their income dry up with today’s rock-bottom yields. Saving accounts pay out next to nothing. Bank certificates of deposit yield only.
DDR Corp: Beaten-Down Stock with a Huge Yield of 11.1%
A High-Yield Stock You Likely Haven’t Considered In a bloated stock market, high dividend yields are hard to find. Consider that, historically, the S&P 500 Index had an average price-to-earnings (P/E) ratio of 15.7 times. Today, the ratio stands at.
JPMorgan Chase & Co. Declares Cash Payment to Investors
JMP Stock Returning Cash to Investors Due to what happened to U.S. banks during the last financial crisis, investors may have second thoughts about putting their money in bank stocks. But in recent years, the U.S. banking industry has made.
This Dividend Stock’s 10% Yield Is Growing
A Growing 10% Yielder Today’s chart highlights another winner in the healthcare business, senior housing. Regular readers have heard our bullish argument on senior housing before. As the population gets older, we’re going to need more nursing homes, retirement communities,.
Healthcare Services Group, Inc.: Quiet Company Delivering Double-Digit Returns
Quiet Stock Pays Dividends Today, we check in on another winner from a graying America. Regular readers have heard our bullish case for the healthcare sector before. As baby boomers age, they’ll need more drugs, more tests, and more checkups..
Lock in This 11.3% Yield by March 28
If You Are Looking for a Double-Digit Yield, Read This Most people have never heard of MTGE Investment Corp (NASDAQ:MTGE), and yet the company offers one of the most generous dividend policies in the current stock market. Consider this: the.
