Motley Fool Money The Dividend Returns
Mar 24, 2024
Join Daniel Peris, a senior portfolio manager at Federated Hermes and author of "The Ownership Dividend," as he discusses the potential comeback of dividend investing. He explains the significance of the "cash nexus" and why free cash flow reigns supreme in today's market. Peris also dives into the evolving landscape of investment metrics, emphasizing a shift from price appreciation to robust, long-term dividends. He warns about the risks associated with dividend income and the necessity of diversification for today's savvy investors.
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Meta's Dividend Announcement
- Meta announced a dividend the day after Daniel Peris's book, advocating for dividends, was published.
- Peris jokingly suggests Zuckerberg read the book in 24 hours and agreed.
Shift in Stock Market Paradigm
- The U.S. stock market has shifted from income streams to a buy-low-sell-high paradigm.
- This shift occurred in the 1990s and continued for several decades.
Buybacks vs. Dividends
- Buybacks are not equivalent to dividends, despite being presented as returning cash to shareholders.
- Buybacks benefit share sellers, while dividends go directly to shareholders.
