When it comes to dividend investing it’s tempting to just look for stocks with the highest current dividend yield and nothing else. In fact, if you look at lists of the best dividend stocks, dividend yield is frequently the most highly weighted criteria. While yield is certainly a valid consideration, there’s more to dividend investing [...]

Dividend reinvestment plans or DRIPs allow you to take dividend payments and reinvest them in shares of stock. If you don’t need the immediate income provided by a dividend paying stock then DRIPs give you a zero thought zero hassle way of increasing your equity in a corporation and thereby increasing the dividends you earn [...]

Most investors try to beat the market. They try to invest in such a way as to generate better returns than the S&P 500 index or some other gauge of investing “success”. In fact, that’s the way most professional investors think as well. Probably because if they don’t meet their benchmark over the short term [...]

You’ve probably heard of the rule of 72.  The mathematical formula that shows that a consistent 10% return on your investments will double your portfolio balance every seven years.  Of course a 10% return is in the realm of fantasy in today’s market environment but what about a 7% return? For a dividend paying stock, [...]

For investors focused on earning returns through capital gains, risk is the probability that a trade that they make will end up losing money.  That they’ll buy at one price and have to sell at a lower price thereby suffering a loss of the number of shares traded multiplied by the change in value per [...]

We’re all looking for dividend paying stocks with a strong history of stable dividends combined with reasonable dividend growth.  Some companies can maintain the corporate discipline to pull this off while others suffer through bad economic times or bad decision making by their executives that causes them to cut their dividends. Although companies rarely broadcast [...]

A key factor in a company’s ability to pay (and continue to pay) a dividend is its revenue or earnings. A consistent stream of revenue going forward means a consistent base upon which to pay dividends going forward as well. Therefore, understanding the concept of earnings per share and how resilient it is to the [...]

When it comes to investing for income, there are two equally important factors to consider. First, how much income will a portfolio of investments provide and, second, how likely are those investments to provide that income for as long as you need to depend on it? So, when we talk about a safe dividend, we’re [...]

Imagine that you’re the CEO of a public corporation.  Your job is not only to produce earnings for that corporation’s shareholders but also to produce them in enough quantity to satisfy all of the market analysts that will pore over your balance sheets after earnings announcements every quarter. The opinions of those analysts about what [...]

With many equity investments and especially non-dividend paying stocks, share price has only a tenuous relation to the underlying strength of the company the stock represents.  So much of a stock’s value is wrapped up in market psychology and its prospects for future capital gains that entire investing disciplines have evolved around identifying stocks whose [...]