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Invest in Dividend Stocks
Invest in dividend stocks for security and a steady income. There are companies that have routinely paid quarterly dividends for as much as a century. If you want to sleep at night invest in dividend stocks. A contrarian might argue that buy investing in a secure stock that you will give up the potential for growth. However, good dividend stocks typically outperform the Standard and Poor’s 500 stock index over a decade.
What Are Dividends?
A company that makes money oftentimes pays a portion of its profits to shareholders on a quarterly basis. Sometimes this dividend is a onetime payment based on exceptional circumstances. However, when we suggest that you invest in dividend stocks we are talking about companies that send a shareholder a check every fiscal quarter. Dividends from a strong company are a reliable source of cash. They are also proof of the strength of the company and should be considered when doing fundamental analysis of a stock. In some ways dividends are like interest from bonds. A secure company will pay a set dividend that does not change with prevailing interest rates. Thus the price of the stock may go up with lower interest rates and down with higher rates.
High Dividends of Consistent Dividends
The general reason to invest in dividend stocks is long term, consistent dividends. This is what helps you sleep at night as a stock investor. The higher the dividend the better but if a company is stealing from R&D capital to pay dividends it might just be getting a little too desperate to keep its share price up. For long term reliable dividends companies like Colgate, Clorox and Proctor and Gamble come to mind. These reliable consumer products companies keep making money year in and year out. If you do not want to wake up some morning to find that your stock portfolio has evaporated invest in dividend stocks like these. Other sources of reliable and healthy dividends are utility companies.
Finding Good Dividend Stocks
Running a stock screen is a good way to find companies that pay dividends. If you require a certain percentage dividend return set the stock screen to show only stocks that make the cut. Look at how long the company has been paying dividends and check to see if there are gaps in their payment record. Along the way look at the general margin of safety of the company and its intrinsic stock value. You can always profit by using fundamental analysis. Well managed companies with strong profits and competent cost containment typically pay good dividends and are good investments for the long term. For a well balanced stock portfolio, investors commonly invest in dividend stocks as part, growth stocks as part, and invest in a mix of market sectors as well. Remember that dividend stocks commonly increase in value during a down market.
2. Invest in dividend stocks for
security and a steady
income.
www.ProfitableInvestingTips.com
3. There are companies that
have routinely paid quarterly
dividends for as much as a
century.
www.ProfitableInvestingTips.com
4. If you want to sleep at night
invest in dividend stocks.
A contrarian might argue
that buy investing in a
secure stock that you will
give up the potential for
growth.
www.ProfitableInvestingTips.com
5. However, good dividend
stocks typically outperform
the Standard and Poor’s 500
stock index over a decade.
www.ProfitableInvestingTips.com
7. A company that makes
money oftentimes pays a
portion of its profits to
shareholders on a quarterly
basis.
www.ProfitableInvestingTips.com
8. Sometimes this dividend is a
onetime payment based on
exceptional circumstances.
www.ProfitableInvestingTips.com
9. However, when we suggest
that you invest in dividend
stocks we are talking about
companies that send a
shareholder a check every
fiscal quarter.
www.ProfitableInvestingTips.com
10. Dividends from a strong
company are a reliable
source of cash.
They are also proof of the
strength of the company and
should be considered when
doing fundamental analysis
of a stock.
www.ProfitableInvestingTips.com
11. In some ways dividends are
like interest from bonds. A
secure company will pay a
set dividend that does not
change with prevailing
interest rates.
www.ProfitableInvestingTips.com
12. Thus the price of the stock
may go up with lower
interest rates and down with
higher rates.
www.ProfitableInvestingTips.com
14. The general reason to invest
in dividend stocks is long
term, consistent dividends.
www.ProfitableInvestingTips.com
15. This is what helps you sleep
at night as a stock investor.
www.ProfitableInvestingTips.com
16. The higher the dividend the
better but if a company is
stealing from R&D capital to
pay dividends it might just
be getting a little too
desperate to keep its share
price up.
www.ProfitableInvestingTips.com
17. For long term reliable
dividends companies like
Colgate, Clorox and Proctor
and Gamble come to mind.
www.ProfitableInvestingTips.com
18. These reliable consumer products
companies keep making money
year in and year out.
If you do not want to wake up
some morning to find that your
stock portfolio has evaporated
invest in dividend stocks like
these.
www.ProfitableInvestingTips.com
19. Other sources of reliable and
healthy dividends are utility
companies.
www.ProfitableInvestingTips.com
21. Running a stock screen is a
good way to find companies
that pay dividends.
www.ProfitableInvestingTips.com
22. If you require a certain
percentage dividend return
set the stock screen to show
only stocks that make the
cut.
www.ProfitableInvestingTips.com
23. Look at how long the
company has been paying
dividends and check to see if
there are gaps in their
payment record.
www.ProfitableInvestingTips.com
24. Long the way look at the
general margin of safety of
the company and its
intrinsic stock value.
www.ProfitableInvestingTips.com
25. You can always profit by
using fundamental analysis.
www.ProfitableInvestingTips.com
26. Well managed companies
with strong profits and
competent cost containment
typically pay good dividends
and are good investments for
the long term.
www.ProfitableInvestingTips.com
27. For a well balanced stock
portfolio, investors
commonly invest in dividend
stocks as part, growth stocks
as part, and invest in a mix
of market sectors as well.
www.ProfitableInvestingTips.com
29. As such it can be possible to
buy these in anticipation of a
recession and sell when they
move contrary to the market.
www.ProfitableInvestingTips.com
