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.
Wheeler Real Estate Investment Trust Inc (NASDAQ:WHLR): Is This 18.1% Yield Safe?
Should Investors Consider This High-Yield Stock? High-yield stocks are not known for their dividend safety, so today let’s look at a company that currently offers a jaw-dropping yield of 18.05% and see whether it deserves the attention of income investors..
Medley Management Inc (NYSE:MDLY): Unique Investment Opportunity Paying 14.1%
High-Dividend Stock with a Double-Digit Yield Investing in middle-market companies in the United States can be a very lucrative business. The thing is, for the most part, that sector was dominated by big banks. Now, thanks to the consolidation of.
How to Use Shareholder Letters to Find Great Dividend Stocks
The Simple Guide to Shareholder Letters If you think you want to find great dividend stocks, then you’d better start working with one of the main tools of the trade: the shareholder letter. Legendary investor Warren Buffett trolls through hundreds.
Garrison Capital Inc (NASDAQ:GARS): A 13.4% Dividend Yield That Could Grow When Interest Rate Rises
A Great Income Play in a Rising-Interest-Rate Environment In today’s market, one of the things that investors should keep an eye on is rising interest rates. For the greater part of the last decade, interest rates in the U.S. were.
Genuine Parts Company (NYSE:GPC): 61 Years of Dividend Increases and Continuing
The Best Income Investment in the Automotive Industry? For income investors, few things are better than a steadily increasing stream of dividends. And Genuine Parts Company (NYSE:GPC) provides exactly that. Headquartered in Atlanta, Georgia, Genuine Parts Company is an automotive.
Omega Healthcare Investors Inc (NYSE:OHI): Top Dividend Stock Now Pays 8.4%
Collect Growing Dividends from OHI Stock Today’s chart highlights a rare find in the world of dividend stocks: a high-yield stock with a consistently growing payout. I’m talking about Omega Healthcare Investors Inc (NYSE:OHI), a real estate investment trust (REIT).
Alcentra Capital Corp (NASDAQ:ABDC): Is This 13.7% Yield Safe?
Should Investors Consider This Double-Digit Yielder? Since a company’s dividend yield moves inversely to its share price, chasing the best-performing stocks likely won’t give you the highest yields. But, if you go for the down-and-out stocks, you might worry about.
Enterprise Products Partners L.P. (NYSE:EPD): Put Your Money on Cruise Control with This High-Yield Stock
Cash Cow Business Paying Investors 6.84% Imagine putting your money in a stock, collecting a rising stream of dividends, and never having to worry about that position again. That would be the perfect scenario for income investors. Unfortunately, not many.
UNIT Stock: Should Investors Consider This 13.87% Dividend Yield?
1 High-Yield Stock for Income Investors It’s a good thing that investors are not chasing the highest-yielding stocks, because, quite often, a high dividend yield turns out to be a sign of trouble. But that doesn’t mean you should ignore.
Macy’s Stock: Can You Rely On This 7.2% Yield?
Is This Dividend Safe? When it comes to income investing, big yields come with big risk. Case in point: Macy’s Inc. (NYSE:M). Amazon.com, Inc (NASDAQ:AMZN) has made road pizza out of brick-and-mortar retailers, crippling profits of traditional department stores. Macy’s.
