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.
Magna International Inc. (NYSE:MGA): Rising Dividends from an Auto Stock
MGA Stock Provides Solid Dividend Growth Potential In today’s market, automotive companies don’t get much attention from dividend growth investors. Due to what happened during the last financial crisis, auto stocks aren’t really the first ones to come to mind.
CYS Stock: Income Investors Should Strongly Consider This 11.6% High Dividend Yield
CYS Stock is a Top High-Dividend Stock With interest rates in the U.S. starting to creep higher, now is a good time to reevaluate your portfolio and look into potential investments. That’s because not all investments will perform the same.
CLDT Stock: Collect a Safe, High Yield from This Monthly Dividend Stock
CLDT Stock: Top Monthly Dividend Stock Paying 6.3% In today’s market, investors looking for a monthly dividend stock usually have to make a decision. They can either have a low-yield stock with high dividend safety, or a high-yield stock that.
This Little-Known Dividend Stock Yields 9.5%
Oil Stock Offers “Growth-Plus-Income” Most investors don’t turn to junior oil stocks for income, but a new breed of energy startups want to fix that reputation. Years ago, young firms plowed all of their profits into aggressive drilling programs. The.
SBRA Stock: 3 Reasons to Consider This 7.7% High Dividend Yield
SBRA is a Solid High Dividend Yield Today’s article will take a look at a high-dividend growth stock that is giving investors a 7.7% payout. There are many ways to invest in real estate, such as mortgages, physical assets, or.
SEP Stock: A Dividend Growth Stock from the Energy Sector?
Collect Rising Payouts from SEP Stock a 6.5% Yielder When it comes to dividend growth investing, people usually think of recession-proof industries such as consumer staples and healthcare. Indeed, if you take a look at companies with the longest track.
HRZN Stock: Earn a Monthly Income with a 10.9% Yield
A Monthly Dividend Stock You Likely Haven’t Considered Over the last several years, monthly dividend stocks have been highly sought after. As a result, prices of the most well-known monthly dividend payers have already been bid up, causing their yields.
218% Total Return From a Double-Digit Yielder?
Earn a 10.36% Yield from This High-Dividend Stock In today’s market, stocks offering the highest dividend yields tend not to be the best performers. In fact, the reason why many companies can offer a double-digit yield is that their share.
Should Investors Pick Up This 11.7% Yielder off the Floor?
1 High-Yield Stock That’s Actually Worth Considering With the U.S. stock market surging past its all-time high, value is hard to find. And since a company’s dividend yield moves inversely to its share price, a soaring stock market mean that.
NS Stock: Collect a Double-Digit High Dividend Yield
NS Stock’s Consistently High Dividend Yield Have you ever felt that investors on Wall Street know a secret investment strategy? And that’s why they beat the markets annually? Well, their income source isn’t that big of a secret: it’s double-digit-yielding.
