Dividend Stocks
Stocks that provide dividends are an excellent way to build long-term wealth. Not only do dividends provide investors with regular income, but dividend stocks can also help investors weather market volatility. How? Whether the markets are going up, down, or sideways, dividends provide investors with a steady income stream.
Having said that, while dividends are usually paid out quarterly, at the discretion of the company’s board of directors, they can be raised, cut, or eliminated.
Not all dividend stocks are created equal. As a result, there are a number of factors investors need to consider when looking at dividend stocks.
Dividend yield is one of the most important factors to consider when investing in dividend stocks. It might be tempting to just invest in a stock with the highest dividend yield, but there is a risk/reward trade off when it comes to dividend-yielding stocks—the higher the yield, the greater the risk.
Stocks that provide an annual dividend of 10% or more tend to be very risky. Because they are risky, there is a greater chance the dividend could be cut—or worse, the share price could plummet. This means investors lose out on dividend growth and capital appreciation.
History is another important factor to consider. Look for stable companies that have a long history (five, 10, or even 25+ years) of both paying an annual dividend and increasing that dividend annually. Those stocks that offer annual dividend growth as part of their corporate culture are more likely to continue that trend.
The best way to determine whether or not a company can continue to provide an annual dividend and raise its yield is to look at the company’s free cash flow. Free cash flow is the amount of free cash, or money left over after it pays for operations and necessary capital expenditures. The more money a company has in the bank, the greater the chances are that it can sustain or increase its high dividend yield.
WES Stock: 9.5%-Yielder Near Record Highs
Western Midstream Stock Trading at Record Levels I’m putting WES stock in the Income Investors spotlight today. With growing concerns about an all-out war in the Middle East, all eyes are on domestic oil and gas producers here in the.
Could 21.5%-Yielding Mach Natural Resources LP Jump 70%?
Geopolitical Tensions Send MNR Stock Higher Strong financial results are one way to juice shares and dividend payouts for oil and gas midstream companies like Mach Natural Resources LP (NYSE:MNR). Energy policy tailwinds out of Washington, DC, are another. So,.
ZIM Stock: Bullish 45%-Yielder Reports Strong Q1
ZIM Integrated Shipping Stock Trading at 52-Week High Time to take another look at ZIM stock! ZIM Integrated Shipping Services Ltd (NYSE:ZIM) reported an “outstanding” 2024, with that momentum carrying into 2025. Strong first-quarter results come on the heels of.
Vitesse Energy Inc: Could 9.2%-Yielder Jump 36%?
Outlook for VTS Stock Just Became More Compelling The outlook for Vitesse Energy Inc (NYSE:VTS) just became a little more interesting. Oil prices were trading at a 52-week low on concerns about the economy and, for a short time, optimism.
Eagle Point Income Stock: Could 12% Monthly Dividend Pay Off Big?
A Monthly Cash-Generating Machine? In the income investment spotlight today is Eagle Point Income stock. The 2008 financial crisis has left a scar on investors’ minds, and understandably so. During that time, complex debt structures were causing problems for the.
Hafnia Ltd: Bullish Wall Street Expects This 17%-Yielder to Hit Fresh Highs
Outlook for Hafnia Ltd Turns Bullish The outlook for shipping companies has turned bullish after Israel bombed Iranian nuclear and military facilities, leading to Iran launching retaliatory missile attacks. After years of simmering tensions, this could be just the start.
BCBP Stock: This Overlooked Regional Bank Paying 8.2%?
It Checks a Lot of the Right Boxes for Income Investors When investors think about dividend stocks, regional banks are not at the top of the list. But these companies represent a corner of the stock market that shouldn’t be.
Alliance Resource Partners LP: Policy Tailwinds Bullish for This 11%-Yielder
ARLP Units Seriously Outpacing S&P 500 & Nasdaq Today, I’m here to put the focus on Alliance Resource Partners LP (NASDAQ:ARLP). While the demand for coal has fallen over the years, it’s still essential for generating both electricity and heat..
CCOI Stock: 8%-Yielding Telecom Dividend Gem Hiding in Plain Sight
Cogent Communications Offers a Compelling Opportunity When investors think about telecom dividend stocks, two names usually come to mind: Verizon Communications Inc (NYSE:VZ) and AT&T Inc (NYSE:T). Why? Because they are the household brands. Investors see them everywhere. These companies.
CrossAmerica Partners LP: Units of 9.6%-Yielder Thumping Broader Market?
JPMorgan Chase Still Bullish on CAPL Stock During periods of economic uncertainty and stock market volatility, it’s always a good idea to diversify with a reliable, high-dividend-yielding stock with great long-term growth potential. And that’s what you get with CrossAmerica.