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These are our most recent articles. Also see which stocks have been this week’s best and worst performers.
7 Habits of Highly Effective Dividend Investors
Dividend investors come in all different shapes and sizes. Many of us are living off dividends in retirement, while others are investing for long-term income growth and capital appreciation. Regardless of our objectives, we are united by our desires to reduce risk and make responsible investment decisions. However, even the best of us have fallen into traps over the years. For example, numerous academic studies have shown that individual investors are incredibly poor at trying to time the market and are prone to letting their emotions get the best of them. Investors pulled $16 billion from U.S. stock funds in 2009 while stocks were at their lowest prices in a decade, according to a recent Bloomberg [...]
7 Safe Dividend Stocks That Beat Bear Markets
In the midst of the second-longest bull market ever recorded, many conservative dividend investors are feeling increasingly anxious. The S&P 500's forward P/E ratio of 17.1 sits approximately 20% above its 10-year average. To make matters even more uncomfortable for income investors, lower-for-longer interest rates have made safe haven companies such as utilities and consumer staples even more expensive relative to history. No one knows where the market will go from here, but the following companies all have strong Dividend Safety Scores and performed well during the last recession. These companies are safe income bets for buy-and-hold investors and dependable sources of retirement income. While it's hard to make a compelling valuation case for some of [...]
Merck (MRK): Slow and Steady Dividend Growth
Merck is a blue-chip dividend stock that has paid a consistent dividend since 1970 and has grown its dividend at a 1.8% annual rate over the last 10 years. They have been able to continually pay a dividend during difficult times thanks to a recession-resistant business model, attractive operating margins, and reliable free cash flow generation. This is the type of consistency I like to see for investments I consider for our Conservative Retirees dividend portfolio. Currently, the business looks attractive with a nearly 3% dividend yield and optionality for additional dividend increases; however, with many large pharmaceutical companies struggling with billion-dollar revenue drugs’ patent protection expiring, should investors continue to count on Merck’s dividend stability? Business Overview [...]
Kroger (KR): A Bargain Dividend Growth Stock or Value Trap?
Kroger (KR) is starting to get the attention of value and dividend growth investors alike after its year-to-date stock price decline of 22%. Kroger’s stock now trades for less than 15x forward earnings guidance and offers double-digit annual total return potential if management’s growth guidance is to be trusted. Even better, most of the factors weighing on Kroger’s business today have no impact on the company’s long-term earnings potential. These are usually my favorite type of investment opportunities, but readers won’t be surprised to hear that I am very reluctant to invest in any retailer – especially debt-laden, growth-challenged grocers. However, Kroger could be an exception. The company has delivered extremely reliable results for decades and [...]