In an uncertain market there’s a lot to be said for having a firm foundation of dividend stocks for your portfolio. A good income play at a good price isn’t quite as sexy as a roaring momentum stock, but over the long-term, the reliable returns from dividends really add up.
Every investor needs to be biased toward income stocks right now — even if they are at or near retirement, and looking to take some risk off the table. After all, current yields are about 1.8% on T-Notes and just under 2.2% on investment-grade corporates.
Where else are you going to get income?
If you want stability, then well-priced dividend stocks will provide a great backbone for your portfolio in 2017. And if you’re looking for income, you have to remember that even conservative bond funds still have interest rate risk and could lose principle value if and when the Federal Reserve raises rates in the coming month.
In short, there’s no better place to put your money than dividend stocks right now.
Here are nine great picks to consider:
While looking for a bargain dividend stock, many investors simply screen for those with the highest yield or the one that's fallen the most in the past month.
But I take a different approach: How much of a yield will I likely be getting for my purchase 10 years from now?
That type of thinking has led to a couple of outstanding picks over the years.
For instance, I bought shares of Aflac in Feb. 2009 for $17.50. Seven years later, I now get $1.64 in dividends for every share I own. In other words, I now have a 9.4% yield. And it goes up every quarter.
Viewed through this lens, these are nearly a dozen dividend stocks that I think are bargains right now -- based on what they'll likely be paying 10 years from now.
The attached list includes all Dividend Champions with a forward P/E of less than 15. Each of the results grown dividends over more than 25 consecutive years.
These are the stocks I'm talking about...
I've often said that dividend stocks are the foundation of a great retirement portfolio -- and for good reason. For starters, companies that pay dividends usually have a long history of profitability and a sound long-term outlook.
A business that doesn't have a clear path to growth typically isn't going to pay a dividend. In other words, buying dividend stocks often means buying into high-quality, profitable companies with long histories of success.
Secondly, dividend stocks can help hedge the stock market's inevitable moves lower. Since 1950, the S&P 500 has corrected lower by at least 10% (when rounded to the nearest digit) on 35 occasions.
Owning dividend stocks is a great way to help hedge against these market swoons. As an added bonus, since dividend stocks tend to attract long-term investors, they can sometimes also be far less volatile during corrections.
Lastly, dividend stocks give you the ability to take advantage of compounding over time by reinvesting your payout back into more shares. Doing so allows your ownership in a business to grow, as well as your corresponding payout. Compounding is a tactic some of the smartest money managers use to increase the value of their funds over time.
But some of the best dividend stocks can be found floating well below investors' radars. Attached you will find three high-yield bargain dividend stocks you've probably been overlooking this fall. Every of the results has a dividend yield over 4% and a debt-to-equity below one.
These are the results...
As technology changes, business models change as well. The Internet has changed the world, from the way we communicate to being a part of business models that didn’t exist a decade ago to even affecting the retail sector.
Investors have seen as people move away from brick-and-mortar stores and move towards online.
There are many companies paying a dividend and growing that dividend over time.
It is difficult to find companies that will share the profits with shareholders in the form of dividends and that are adjusting businesses to technological changes.
I’ve focused on the following companies that pay dividends to their shareholders and are increasing both their online presence and their payout over time. Below are three large-cap dividend growth stocks that reward the shareholder base time and again.
Here are the results...
It's been a choppy year so far for big-dividend Real Estate Investment Trusts (REITs). This has created some attractive buying opportunities as the market moved from January/February distress, to a near-infatuation with yield in the months that followed, a Brexit-induced flight to quality, a new real estate sector, and perhaps another leg lower following the upcoming November 1-2 Federal Reserve meeting.
For your consideration, we've provided a ranking of the best and worst performing big-dividend REITs year-to-date, and we've also provided five general recommendations on how to "play" the current state of the REIT sector. Further, we cover several specific REIT opportunities in this article, and here is our list of Top 8 Big-Dividend REITs Worth Considering.
These are the results...
