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Investment Research Since 1978

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You’re Telling Me about 8% and Pickleball

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If you’re thinking about retirement or investing in some high yield real estate deal, don’t. Because as soon as you run a few scenarios grounded in reality and not “pie in the sky” dreams, you quickly realize losing income and principle are grave mistakes you don’t recover from, ever. In my conversations with investors, I hear it all. You wouldn’t believe some of the dividend yields I’m told are out there, ranging from eight to twenty percent. Good luck with that. When the government offers ten-year treasuries with an annual yield of 0.66%, it’s time for a reality check. “But,” you … [Read more...]

Don’t Follow Europe into Banning Bank Dividends

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At The Financial Times, Greg Baer makes the case against banning bank dividends. He writes: Leaving aside its putative benefits, a blanket dividend ban imposed outside the current regulatory framework would come with a substantial cost. It would make it difficult for investors to value banks, and thereby make them decidedly less investable. Investors might logically prefer companies whose boards of directors retain authority to maximise value for shareholders, so long as all regulatory requirements are met. This would continue a worrisome trend. The market value of US banks, relative to … [Read more...]

An Alternative Approach to Investing when Markets are Down

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In 2008, when investing seemed like an exercise in futility to many investors, I explained an alternative approach. This approach has worked for me now for over five decades. I learned this method from the teachings of Ben Graham, and have successfully employed it my entire career. Here’s what I wrote: Concentrate on Shares, Not Price... The stocks and funds you own pay you dividends based on the number of shares you own, not on the price of those shares. Unless you are fortunate enough to be Gandalf redux, it is likely that the price of most of the shares you own in 2008 is down hard, to … [Read more...]

This Keeps You in the Game in Times Like These

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Coronavirus Infects Stock Market: Part XXXIV Your takeaway from my chart below, where stocks did nothing for a generation is, dividends—as in d-i-v-i-d-e-n-d-s. In the chart below, they’re not included. It’s a simple price chart. Remember, if you’re receiving dividends—like rent on an income property—you’re being paid to be in the market. Price isn’t much of a concern. You don’t live or die by the price of a property year to year. It’s the initial price you pay and rents that bring home the bacon. Relying on fluctuations in prices is speculating, not investing. Take a look at Young … [Read more...]

Dividend “Suspensions” Not Dividend Cuts Coming Fast

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The liberal electronic and print media will shortly be howling – with cartoon-size bold headlines – about dividend cuts. We just began the second quarter of the year. Third-quarter earnings reports will, thanks to the lying Chinese, be breathtakingly ugly. And the media will be out in full force glomming on to disruption. Words like recession and depression will fill the media channels. Greedy and grasping stockbrokers will be out, in full-scale hyena mode, yelling, "sell, sell, sell." Serious, long-term, compound interest focused mavens will follow my lead by engaging in a quiet, … [Read more...]

A Bird in the Bush is Worth Two in the Hand

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Yeah, you read that right. In today’s stock market where tall tales can ignite a speculative frenzy in individual names reminiscent of the dotcom bubble, companies that return cash to shareholders have been eschewed. Generating revenue and profits and paying dividends is apparently out of fashion in 2020. The chart below shows the YTD performance of three different groups in the Russell 1000 index (largest 1000 stocks). The first group is the highest 50% of dividend payers not counting companies that don’t pay dividends. The second group is the bottom 50% of dividend payers not counting … [Read more...]

Best of Young Research 2019: Dividend Investing

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Below are five of Young Research’s most popular dividend investing posts of 2019. When Dividends Pay You to be Patient Young Research's Retirement Compounders® Investment Program Procter & Gamble (PG) Stock: The Only True Dividend King The Highest Yielding S&P 500 Stocks Dividends Then and Now Are the Answer … [Read more...]

Here’s How I Climbed on the Dividend Bandwagon

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There are few histories as crucial to the course of my life as my awakening to the power of compound interest and the importance of dividends. Since my decision to climb on the dividend bandwagon, I have been an evangelist to hundreds of thousands of paid subscribers, and many more investors beyond. My message has been consistent and clear, and I don’t regret focusing on dividends a bit. Here’s how it all started. Back to Monterey and Woodstock I’ve been developing investment strategies for investors like you before The Association kicked off the 1967 Monterey International Pop Festival … [Read more...]

The Dividend King of the North

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Which Canadian stocks are dividend kings? If you go by the internet’s definition of a dividend king (50 consecutive years of dividend increases), there aren’t any dividend kings in Canada, but as we wrote here, there can only be one true dividend king. The Dividend King of the United States is Procter & Gamble. Procter & Gamble is the dividend king of the U.S. because it has increased its dividend annually for 65 consecutive years (tied for first with one other company). Who is the Canadian Dividend King? There aren’t any Canadian companies that meet the 50-year dividend king … [Read more...]

High Dividend Small Cap Stocks: Should You Invest?

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High dividend small-cap stocks can be a source of fresh dividend investing ideas, but just as buying the highest dividend paying large stocks can come with significant risk, so too does investing in high dividend small-cap stocks. Below we explain the opportunities and risks of high dividend small-cap stocks and provide a list of some of the highest dividend paying small-cap stocks. Historically small dividend stocks have outperformed large dividend stocks. The chart below compares the performance of small-cap dividend stocks to large cap dividend stocks. From year-end 1948 through … [Read more...]