Saturday, September 3, 2011

Investing for dividends

Before you invest in a high-dividend stock consider whether the dividend is sustanable.
If the dividend per share is a very high percent of the earnings per share, it may be cut.
Some stocks pay dividends that exceed their earnings which cannot continue unless earnings improve.
Also, look at earnings growth.  Are earnings per share increasing or decreasing? 

A good way to begin your search is to google "dividend aristocrats" and "dogs of the dow"
Then check for earnings growth.

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