Dividends4Life: How To Choose The Best Dividend Stocks

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How To Choose The Best Dividend Stocks

Posted by D4L | Wednesday, February 09, 2011 | | 0 comments »

One of the main characteristics of quality dividend stocks is that they have a strong brand name. Strong brand by itself would not provide the type of consistent long-term returns that dividend growth investors expect. Add in a wide economic moat, or a strong competitive advantage, which ensures strong pricing power and the qualitative screen for selecting stocks is complete.

Another important characteristic for selecting quality dividend stocks is a history of consistently growing distributions. I like it when a company pays a stable dividends, but I really prefer a company that manages to surprise me by repeatedly raising distributions for many years. This is what truly separates the best companies from the mediocre ones. After all, any company can manage to pay a dividend, but only the best ones with the widest economic moats can afford to grow distributions for many years.

Source: InvestorPlace

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