Motley Fool Money Dividends 101
Jul 9, 2022
Join Motley Fool analyst Matt Argersinger, a dividend investing specialist, as he dives into the world of dividends. He discusses the advantages of buying dividend stocks and how to identify healthy payouts, using examples from renowned companies like Coca-Cola. Matt shares insights on the benefits of dividend aristocrats and explores promising opportunities in firms like eBay and Quest Diagnostics. He also compares individual dividend stocks to ETFs, weighing the attractions of both for investors.
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Dividends Empower Investors
- Dividends offer investors a share of company profits and empower them to reinvest.
- While some investors, like Warren Buffett, prioritize high-return reinvestments, dividends benefit shareholders when companies lack such opportunities.
Dividends as Financial Indicators
- Consistent dividend payments and increases often indicate a company's strong economic moat and financial health.
- Examining dividend changes offers insights into management's future expectations and company performance, like with Vail Resorts.
Dividend Aristocrats Outperform
- Dividend aristocrats, S&P 500 companies with 25+ years of consecutive dividend increases, often outperform the S&P in down months.
- A Standard & Poor's study showed they outperformed about 69% of the time since 1990 when the S&P had negative returns.