I have been getting a whole bunch of emails recently asking me for my picks of the highest dividend yielding stocks that I would recommend buying. I think this really speaks to two factors at play here. First, I do not make recommendations on what stocks to buy. I am not a financial advisor nor am I licensed to offer investment advice. Second, when trying to build a dividend portfolio it is not the dividend yield that is important - it is the dividend growth! Dividend yield is simply …
Dividend Increases are Down and Dividend Cuts Are Up
The universe of divdend increasing stocks took a cut in Q1 of 2008 which, can impact how dividend investors manage their portfolios. If you are an investor who looks to build up a stable contingent of 20 - 30 companies that consistently increase their dividends then the universe of stocks got smaller. In an article published by IndexUniverse, the data from the folks at Standard and Poor's is very telling. Have a look at the chart below: Click to Enlarge As you can see, compared to 2007 …
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Some More Dividend Payout Ratio Data
In yesterday's post I floated the alternative view that high dividend payouts lead to better earnings for a company. Today I thought I would show some of the residual facts and figures I found when researching yesterday's topic. I have included some data on the average dividend payout ratios for various types of companies, the decline of dividend payout ratios for the S&P 500 over time, and other various statistics about the dividend payout ratio. The Average Payout Ratio for Various …
High Dividend Payout Ratio = High Earnings Growth Rate
I have always been under the impression that a dividend payout ratio must not be too high because it can limit the ability of the company to grow. In fact, in my weekly dividend stock analysis posts, I look for a dividend payout ratios that are at least below 60%, preferably even lower. I have selected this target because I have believed that the lower payout ratio will provide the company with a sizable chunk of earnings to grow the business and with a lower than 60% dividend payout ratio a …
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My Current Effective Dividend Yield: General Electric
I buy dividend stocks that increase their dividends year after year. When I initially buy these stocks, I am adding them to my portfolio at a particular dividend yield. For example, when I buy a $20 stock with a dividend of $1 my dividend yield is 5%. However, the stocks I purchase are dividend growth stocks that increase their dividends year after year. As a result of these dividend increases, I often find that my effective dividend yield on these stocks increases over time. Let me provide …
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