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Many dividend investors find some security in a high yield. But we will show you another perspective during this episode. Ignoring companies with a yield below 1% is a big mistake and we’ll explain to you why. Then, we will share concrete examples of low-yielding dividend stocks that should not be ignored. Ever heard of Apple, Canadian Pacific, or Nike?
You can download the Inflation Booklet here.
You’ll Learn
- There are two different common profiles among dividend stocks: high yield, low growth, and high growth, low yield. One could think stability vs volatility, but also income vs higher total returns… or Canadian Utilities vs Alimentation Couche-Tard. Which one do you think is better?
- Having a higher yield in a portfolio is great. However, the current market makes them harder (and riskier) to find. There are not many reasons to pay a high yield these days.
- Inflation is another good reason to not ignore low-yielding stocks. Companies with low yield high growth will generally continue to generate growth even during the high inflation period.
- A yield below 1% is almost like a non-dividend stock. So what are the advantages of low yield stocks over non-dividend equities? The answer is in the metrics!
- There are many companies in the Technology sector that show low yield and high growth. Learn more about AAPL, MSFT, V, and MA.
- In the Consumer Staples sector, we can think of Church & Dwight, Costco, and Alimentation Couche-Tard which are safe and stable businesses.
- The brand power of Nike, and the almost perfect dividend triangle of Park Lawn Corp should not be ignored.
- In case we didn’t have enough, three other companies prove that a yield below 1% should not be ignored by investors: Brookfield Asset Management, Canadian Pacific and Franco-Nevada.
Related Content
Inflation has been rising for many months now. How will it continue to impact you and your portfolio? From a look back in history to which sectors or stocks can benefit from the situation, here’s everything you need to know about inflation!
Inflation is Rising, What Does It Mean for You? [Podcast]
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This podcast episode has been provided by Dividend Stocks Rock.
The post Ignoring Yield Below 1% Is Your Biggest Mistake [Podcast] appeared first on The Dividend Guy Blog.
