Income investors are always on the hunt for dividend stocks that have a nice, sustainable yield. That’s not often easy to find, though. Many dividend stocks may not have a large enough moat to defend their position, and what may appear to be a sustainable payout could suddenly come under fire if the company rests on its laurels. That’s why I like dividend stocks that have tons of cash on hand. Even if they have some debt offsetting it, if that cash hoard is so big that the dividend stock can withstand an assault from the Avengers, then I’m not going to worry over the long-term.
The other benefit of having a dividend stock with a lot of cash and little or no debt? It provides you with an effective discount to the stock price. If a dividend stock trades at $50 per share but has $10 per share in cash, you are getting the business for $40 per share. That’s a hidden value that may make the stock less expensive than it may appear. Let’s look at some great dividend stocks that are flush with cash: Microsoft Corporation (MSFT), Garmin Ltd. (GRMN) and Intel Corporation (INTC).
Source: InvestorPlace
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