Dividends4Life: Can Dividend Stocks Continue To Rule?

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Can Dividend Stocks Continue To Rule?

Posted by D4L | Sunday, July 24, 2011 | | 0 comments »

Having risen from the ashes of the financial crisis in 2008 and early 2009, hundreds of companies have put in a full recovery. You can see the clearest sign of the stock market's health by looking at how many companies are paying and increasing dividends on their stocks. Yet as good as things are going now, prudent investors have to wonder whether the good times have to come to an end -- and if so, when.

Perhaps most importantly, investors have made it clear that they'd prefer to see healthier dividend payouts over other, less efficient uses of capital. Too often, corporate management wastes cash on overpriced acquisitions or ill-timed share buybacks. The easiest way to avoid criticism for a bad strategic decision is simply to turn the money over to shareholders and let them make their own capital investment decisions. The rapid acceleration of dividend payouts will come to an end at some point. In the meantime, though, dividend investors have a lot to celebrate -- and at least for now, the party doesn't look like its set to end anytime soon.

Source: Motley Fool

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