When you invest in companies that have a strong history of growing dividend payouts, you know fairly quickly you have found a well-managed company with sufficient cash flow from operations to buy back its investors with dividends that are increasing every year. "Dividend increases are a sign that companies are comfortable their future profit will be resilient." TOM CONNOLLY, FOUNDER CONNOLLY REPORT So the second rule of dividend investing is the "price rule". As a guideline,
These are typically well known businesses with: · Long dividend histories · A seasoned management team · A strong balance sheet · And proven products. The first rule of dividend investing is to buy only high quality dividend growth stocks. This is the quality rule. “As Graham, Dodd and Buffett have all said, you should always remember that you don't have to swing at every pitch. You can wait for opportunities that fit your criteria and if you don't find them, patiently wait.
By Floyd Saunders, Founder of Really Simple Investing and the author of Five Paths To Wealth, Family Financial Freedom and Figuring Out Wall Street. Disclaimer: Really Simple Investing make this information available for informational and educational purposes only.
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