Stocks With Earnings to Keep Paying Dividends

Buying dividend-paying stocks has many advantages. Historically, dividendpaying stocks outperform non dividend paying stocks. Each time a dividend is paid, the total capital at risk decreases. If a stock dividend is 3% and the company never adjusts their payment up or down in real dollars (not likely, but we will assume so for illustration purposes) the company will pay you back in full for your purchase in about 23.5 years. At 4%, it takes less than 18 years.

Investors always have to be cautious when reviewing high-yielding stocks. Dividends gained have been known to vaporize quickly into losses with companies that cut back the payment. A company's board of directors generally authorizes dividend payments every quarter, and there are no rules that say they must continue payments if they do not believe dividend payments are in the best interest of the shareholders and company.

Source: TheStreet

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