Dividend Yield Breakthroughs
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You don’t go to the Carnegie Deli on 7th Avenue in New York City for Egg Foo Yong.
You don’t crunch into a middle seat on a long flight when you could sit by the aisle.
And you probably don’t want to spend your time checking out Dividend Stocks Research on your smartphone when you’re sitting courtside for a Final Four college hoops game (even if the game’s a blowout late at the half).
But how about this?
Do you want to know the #1 place to find a great dividend yield?
Ready to capture a few dividend yield breakthroughs?
Here’s how.
Go watch a movie.
It’s all right there in the 1942 classic “Casablanca” when Captain Louis Renault snaps his famous order after Major Strasser is shot…
“Round up the usual suspects.”
The usual suspects of the dividend investing world are the S&P 500 Dividend Aristocrats.
And they’re the first place you should look for a dividend yield breakthrough.
But here’s the thing. The kind of breakthrough I’m talking about is a nice, above market average return.
Not some overnight profit explosion.
I’m partial to quiet breakthroughs that don’t attract a crowd. A decent, well-mannered dividend yield that lets you sink into deep sleep.
Sound good?
Dividend Yield Breakthroughs For The Light Sleeper
Not each one of the 53 stocks on the S&P 500 Dividend Aristocrats will give you a great yield.
In fact, a few of them are downright scary, and could be tossed off the list.
Want to make sure you’re sidestepping dividend disasters?
Want the best dividend paying stocks?
Check out my article, Can You Predict The Death Of A Dividend Aristocrat?
OK. Here’s what to do to zero in on a great dividend yield.
There are 22 S&P 500 Dividend Aristocrats with yields in the 2-3% range.
And 15 in the 2-2.5% range.
We want to focus on these 15 dividend stocks because they occupy solid middle ground.
The dividend yield isn’t so low it qualifies for chump change status. And it’s not so high that we’ll sweat it out worrying about a cut.
But be careful. Not all of these 15 stocks are a good deal.
In fact, 12 of them are flat out expensive. They trade at a higher Price/Earnings Ratio than the overall market.
Shake down the numbers and you’ll see. The only good deals, where you can buy a great stock on sale are…
Chubb Corporation (CB)
America’s 8th largest property and casualty insurance company with $13.9 billion in revenue.
It’s been paying a growing dividend for 49 years.
Illinois Tool Works (ITW)
$15.9 billion in revenue from manufacturing fasteners, components, equipment, and specialty products.
It’s been paying a growing dividend for 51 years.
Dover Corporation (DOV)
$8.729 billion in revenue. It’s in the specialized industrial products and equipment business.
Dover has been paying a growing dividend for 59 years.
Does This Kind Of Dividend Yield Work For You?
Now I’m not saying run out and buy these 3 stocks. I’m saying you want to look for stocks that pay a decent yield and are reasonably priced.
These are the kind of stocks that can reward you with a dividend yield breakthrough. Nice, consistent dividend income.
You want to look for proven player. Stocks that have been able to step up to the plate and pay a dividend when times get tough.
And here’s something else to keep in mind when you hunting for your own dividend stocks.
Look for companies that aren’t scrambling to throw every dollar they can get their hands on into a dividend payment.
You want plenty of breathing room. Things can get worse and companies like these 3 can hold up well. They have the ability to grow the dividend.
Go Find Your Own Dividend Stock Breakthroughs
Look…
Doing what I’ve done, you can make your own discoveries.
Maybe you’re not as light a sleeper as I am. You can tinker with your requirements and maybe not be so picky on the dividend payout ratio.
Maybe you ratchet it up and go for a yield in the 3-4% range. That’s your call.
Me, I get jittery, even though I live on the beach where the soft roar of the surf lulls me to sleep.
Maybe you’re fine with a slightly higher Price/Earnings Ratio. Perhaps you don’t get riled up when the dividend payout ratio gets up over 50% or 60%.
Stay focused on the prospects for dividend growth, and don’t go chasing yield.
Chasing yield is easy. As easy as walking up to the roulette wheel.
Just stay away from the exotic.
Do what Captain Renault did in “Casablanca.”
“Round up the usual suspects” and you’ll find a dividend stock breakthrough waiting to happen.
Regards,
Michael Jennings
Note: Michael Jennings writes and edits DividendStocksResearch.com. Sign up for our free dividend reports and dividend newsletter at https://www.dividendstocksresearch.com/free-sign-up. We’ll show you how to create regular income by investing in dividend stocks, easily, step-by-step.
Category: Dividend Yield
