When share prices plummet -- like they've been doing this year -- it can be great for dividend investors. Former "meh" picks can turn into high-yielders overnight. But if shares fall too far, or companies get into too much trouble, those same dividends can be put at risk. Here are three top tips to help you pick the best dividend stocks for your portfolio, and three stocks that fit the bill.
No. 1: Look for healthy businesses
A lot of dividend investors chase the highest yields, and don't look much beyond that.
No. 2: Avoid volatile industries
Just because a company is doing very well and easily covering its dividend, don't assume the current situation is the norm.
No. 3: Look at yield last
Not all high yields are dangerous yields. If a healthy company in a stable industry is offering a high yield, there's every reason to take it...as long as there are no hidden issues with the company.
Source: Motley Fool
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- Wealth is a Journey, Dividend Stocks Can Take You There
- 6 Higher-Quality, High-Yield Dividend Stocks
- 10 Stocks With Sustainable Dividend Growth
- 12 Dividend Growth Stocks With A Good Yield/Growth Mix
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