Dividends4Life: Buy dividend stocks after a bear market

Buy dividend stocks after a bear market

Posted by D4L | Friday, October 08, 2010 | | 0 comments »

“My investment approach is to buy dividend-paying stocks when they are value-priced and hold them forever,” says Robb Engen. He is hoping to eventually replace his employment income with dividend income. A great time to buy value-priced stocks “is after a bear market,” suggests Mr. Engen. To assess value, he will look at criteria such as the dividend yield, price-earnings ratio, dividend growth, and payout ratio.

Mr. Engen especially likes companies that regularly raise their dividends. Take Fortis Inc. “If you bought Fortis in 2005, you would now be earning an 18-per-cent yield on the cost of those shares,” writes Mr. Engen on Boomer & Echo – a blog co-authored with his mom (she’s the Boomer, he’s the Echo).

Source: Globe and Mail

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