Dividend Stocks To Pass On

Investors need to be more careful than ever. Prior to today, the markets were getting a little jittery and the yield on the 10-year Treasury had spiked higher. The rally will continue — but it’s going to become more concentrated in those stocks with the best company fundamentals. That’s why it’s critical to avoid those with poor fundamentals — even higher-yielding ones, as they still could lose you more in stock depreciation than they pay out in dividends.

Fortunately, we have Portfolio Grader to help us eliminate the stocks at risk of serious underperformance over the next year: DuPont (DD) is a classic American success story, and its products are used in a wide range of industries. The company was downgraded to a “D” last October, and there has been no substantial fundamental improvement to warrant a change since then. At first glance, the 6% dividend yield of telecom CenturyLink (CTL) looks very enticing. A look under the hood shows us that the stock is best avoided by most investors right now. Sales have been declining for the past five years, and they dropped again in the first quarter of the year.

Source: InvestorPlace

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