Dividends4Life: Dividend Stocks With Strong Cash Coverage

Dividend Stocks With Strong Cash Coverage

Posted by D4L | Monday, November 14, 2011 | | 0 comments »

Dividends are not future guarantees. Although companies try very hard to avoid cutting their dividends because of the bad publicity, a history of paying a dividend does not mean the company will necessarily continue to do so. As an investor going into a dividend stock investment, it's vital to perform due diligence first if you want to rely on the dividend income.

Operating cash is often the company's source for funding dividend payments -- at the very least, it's the most sustainable source. This implies that dividends are only as sustainable as the company's operating cash flows, so analysis of cash flows is important. Use this list as a starting point for your own analysis:

1. Navios Maritime Holdings (NYSE: NM)
2. Universal (NYSE: UVV)
3. BT Group (NYSE: BT)
4. Sasol (NYSE: SSL)

Source: Motley Fool

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