Southern Company (SO) shareholders received good news this week. The four co-owners of the Vogtle nuclear power plant voted to continue construction on the troubled $27 billion project despite the latest set of cost overruns. Had the project been canceled instead, Southern Company's shareholders, rather than its ratepayers, could have potentially been on the hook for billions of dollars of unrecoverable losses. That's a key reason why SO's stock rallied moderately on the news. A short-term hit to the firm's financial health appears to have been avoided, and its dividend safety outlook remains unchanged. But there's more to the agreement reached this week that could have implications for Southern Company's longer-term outlook. As a refresher, the nuclear project has four [...]

Dominion Energy (D) has managed to significantly outperform most other regulated utilities over the past decade, establishing itself as a quality dividend growth investment. A large driver was the utility's expansion into midstream infrastructure, specifically natural gas and liquified natural gas (LNG) storage, transportation, and export capacity. However, in recent years the midstream industry has faced major headwinds, and now Dominion Energy has announced it feels it has to radically change its midstream growth strategy by offering to buy out its MLP, Dominion Midstream Partners (DM). Let's take a look at what this means for investors in both stocks, but especially what implications it has for the future growth prospects of Dominion Energy's earnings and dividend.

For most investors, owning dividend-paying stocks is all about the income. And dividend yield is a critical metric in the stock selection process. However, there are some important concepts investors need to understand about the dividend yield formula and how to apply it to maximize their long-term financial returns. Let's take a look at what you need to know about this simple but essential formula.

Many retirement-aged investors lean on dividends to make ends meet. The idea is to receive a stream of passive, predictable, and growing income that is independent of fickle stock prices. Instead of worrying about where the market might head any given year or which investments to sell to generate income using the 4% rule, many dividend investors bank on the resiliency of their income rolling in and hope to leave their nest egg largely untouched. But is this really a wise strategy during recessions? After all, if dividends are paid out of cash flow, which shrinks for most companies during economic downturns, significant dividend cuts seem like they should be expected as well. In this article, we will examine historical evidence [...]

Preserving capital and generating safe income are core goals in retirement. So not surprisingly, conservative investors often worry about when the next recession will occur and how it will affect their portfolios. Safe dividend-paying stocks can be an appealing choice for retirees who desire a predictable income stream that can hold its ground regardless of economic conditions and short-term stock price fluctuations. In fact, over 240 dividend-paying stocks in our database maintained or increased their dividends each year during the financial crisis while also outperforming the S&P 500's 55% peak-to-trough plunge by more than 20%. In other words, there were some excellent recession proof investments a risk averse income investor could have owned prior to the last downturn. But what [...]

Since being spun off from Altria (MO) in 2008 Philip Morris International (PM) has raised its dividend every year and delivered predictable returns thanks to the steady nature of the tobacco business. However, this year Philip Morris shares are down nearly 25% on growing concerns over whether its strategy for adapting to the continued global decline in smoking can succeed. Let's take a closer look at why the market is so bearish on this tobacco giant and whether or not Philip Morris investors need to worry about the safety and long-term growth prospects of its generous dividend. Philip Morris is Betting Big on Reduced-Risk Products But Has Hit Some Growth Challenges About 93% of Philip Morris' revenue still comes from [...]

Over the past half century tobacco giant Altria (MO) has not only been a dependable source of safe and fast growing dividends, but it's also been one of the best performing stocks in the market. However, in 2018 MO's stock has slumped 15%, pushing its dividend yield to its highest level since 2014. As traditional cigarettes continue their secular decline and more alternative products enter the market, some investors are worried about Altria's long-term outlook and the safety of its dividend.

The current U.S. economic expansion is now the second longest in history. While the next recession may not be imminent, at some point one will happen. So let's take a look at how to prepare your portfolio for a recession, including what specific sectors and asset classes hold up best for retirees concerned with safe and stable sources of income. Three Major Asset Classes to Consider Most investors spread their portfolios across three types of major asset classes: cash, bonds, and stocks. Each group has its own strengths and weaknesses, both over the long term and during recessions and bear markets. Cash and cash equivalents (such as savings accounts and short-term U.S. treasury bills) are a way of ensuring short-term [...]