High-dividend stocks sound like an obvious winner. You get a large dividend payment on a periodic basis that you can choose to take straightaway or roll over into further stock purchases in the company. What's not to like? Stocks that pay the highest dividends are not necessarily the best choice. There is more to the story than just a simple percentage or dividend yield. Let's drop back and take a more fundamental look at dividends in general.
Companies that are at the top of the dividend yield rankings are almost certainly not going to be able to sustain those dividends over time. If a company is making enough income to afford regular 10% dividends, constantly paying out 10% of the share price, are they investing enough money back into the business to maintain their growth rate? Few companies enjoy that sort of profit margin and when they do, they don’t usually enjoy it for long.
Source: Fox Business
Related Articles:
- Optimizing Your Asset Allocation
- Dividend Growth Stocks Are My Conviction
- All Investing Involves Risk
- 7 Dividend Stocks With Room To Increase Their Payout
- High-Quality, Low-Risk Dividend Stocks
Highest Dividend Stocks - Current Offerings, and Why You May Want to Avoid Them
Posted by D4L | Sunday, November 08, 2015 | ArticleLinks | 0 comments »________________________________________________________________
Subscribe to:
Post Comments (Atom)
~
Popular Posts Last 30 Days
-
If you're worried about inflation rearing its ugly head next year, you should probably worry about more likely catastrophes, such as bei...
-
As a relatively new blogger, the one thing that has stood out in my mind is the number of Canadian bloggers in the areas that I am most inte...
-
When a company pays a dividend, it's a good thing for shareholders. When a company consistently pays a dividend every quarter, it's ...
-
If you've been holding back from investing in your future just because you don't have a lot of extra cash to spare, I've got gre...
-
If you are looking for high-yield dividend stocks that can beat the market, you might want to check out these three companies. They all have...
-
If you are here to build a portfolio that thrives in all seasons, consider dividend stocks. They can generate steady returns and provide sta...
-
One way to achieve financial freedom is to create passive income, or income that does not depend on your active involvement beyond a certain...
-
My top financial goal is to eventually become financially independent. The foundation of my strategy is to make investments that produce an ...
-
The company's remarkable consistency and low-risk business model make it a "first-choice investment opportunity," according to...
-
Since 1926, dividends have contributed approximately 32% of the total return for the S&P 500, while capital appreciations have contribut...
0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.