Growth stocks make most of the headlines, but they don’t always make investors the most money. Investing in a hot industry can be exciting, but who can say which firms will survive? Will these businesses even be profitable? The real money, as the top dividend stocks above show, comes from compounding small returns over long periods of time. You typically find those kinds of profits in businesses that don’t grow, don’t innovate, and don’t make headlines. But if you’re willing to trade being the talk of your next cocktail party for steady returns, cash cows might be some of the best investments around.
Yet despite their stodgy reputation, cash cows owners have become rich over the decades. In a 2015 paper, Credit Suisse Group AG (NYSE:CS) published the returns of each industry between 1900 and 2010. The best businesses tended to be slow, mature industries like food, chemicals, and electrical equipment. (Source: “Credit Suisse Global Investment Returns Yearbook 2015,” Credit Suisse Group AG, last accessed March 8, 2017.) Take my favorite cash cow, Iron Mount REIT (NYSE:IRM), for example. The firm has the excitement of milk toast. The company stores paper documents for businesses, charging a fee in exchange for warehouse space. J M Smucker Co (NYSE:SJM) looks like a textbook cash cow. The company makes jam, pet food, and other pantry items. In other words, timeless products that don’t need to be reinvented every few years. Smuckers will probably look the same decades from now. Enbridge Energy Partners, L.P. (NYSE:EEP) might be the best cash cow of all.
Source: Income Investors
Related Articles:
- 4 High Yield, High Risk Dividend Stocks
- 5 Dividend Stocks To Buy And Hold, Not Buy And Forget
- All Investments Carry Risk
- Warren Buffett's Two Investing Rules For Dividend Investors
- Dividend Stocks vs. Dividend ETFs
These Top Dividend Stocks Yield Up to 13%
Posted by D4L | Thursday, March 30, 2017 | ArticleLinks | 0 comments »________________________________________________________________
Subscribe to:
Post Comments (Atom)
Popular Posts Last 30 Days
-
The fact is that there are many interesting high-yielding companies that have good long-term prospects. Besides, as the markets get more vol...
-
Dividend stocks are very appealing to investors, for good reason. Growth stocks tend to make the headlines — with the 2020 pandemic, shareho...
-
Part of the joy of investing is seeing your good investments continue to grow, years after your initial purchase. Aside from the financial s...
-
A common measure of dividend sustainability is the payout ratio, the percent of earnings that are paid out to shareholders. Unfortunately, e...
-
Investors looking for the best dividend stocks for 2021 and beyond should take a closer look at the stocks with the longest histories of ann...
-
Some investors — usually referred to as income investors — specifically set out to buy securities that pay them even before stock price appr...
-
Are you looking for a great dividend stock to add to your portfolio? There are many options out there, but the reality is that many just don...
-
A lot changes when you shift from working to retirement, including how you invest. Most investors switch from building a nest egg to living ...
-
Last month we wrote about the top four companies in our model portfolio in the article 4 Dividend Dominators for 2021 - Companies With More ...
-
This stock yields 7.07% and pays monthly. It's selling at a -6.4% discount to NAV - much deeper than its three- and five-year average di...

0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.