Is it possible to double your money – quickly – buying safe
dividend stocks? You bet. Let me explain how…
“Basic” income investors are enamored with higher current
yields. These are OK for payouts today, but they’re not going to get us 100%+
gains.
For triple-digit profits we must pay attention to the underrated
dividend hike. These raises not only increase the yield on your initial
investment, but they trigger stock price increases, too.
For example, if a stock pays a 3% current yield and then
hikes its payout by 10%, it’s unlikely that its stock price will stagnate for
long. Investors will see the new 3.3% yield and buy more shares. They’ll drive
the price up, and the yield back down – eventually towards 3%.
This is why many Dividend Aristocrats don’t pay high current
yields: Their prices just rise too fast. Just look at A.O. Smith (NYSE:AOS),
which perpetually yields in the low 1% range. The low yield isn’t from a lack
of dividend hikes – in fact, AOS keeps hiking its payout more aggressively over
time. But investors just keep chasing the stock too high!
What a “problem” to have!
If you’re looking for a “dividend stock double” to bring you
secure gains of 100% or better, consider these ten payers. Don’t be fooled by
their modest current yields – these dividends will probably always look modest
thanks to soaring share prices.
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