What better goal to have for 2012 than to start a diversified portfolio of dividend growth stocks that will reward you for being a loyal shareholder by distributing quarterly, semi-annual or annual dividends? Building a sustainable passive income stream by investing in quality businesses that have an economic moat, a lengthy history of rising earnings and dividends, solid balance sheets and are trading at attractive valuations allows you to take that income and reinvest it back into dividend growth stocks or use that income stream for other ventures
It is important to remember that not only do you receive a portion of earnings in the form of dividends from these companies, but these companies also re-invest earnings back into the company to continue to grow the business. This will lead to higher earnings, and therefore a higher share price which leads to an increase in the market value of your investment. The key to starting your new year off right and building a dividend growth portfolio is to commit to a plan, do your due diligence and be ready to make changes as market conditions change
Source: Guru Focus
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- Why Dividend Stocks Are Evil
- Don't Touch These 5 Dividend Stocks!
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