However, I've noticed that some of them purchased companies with a high dividend yield (annual dividend / price of the share) but with a
pretty low dividend growth.
The study showed that stocks with relatively high yields and relatively high 3 year dividend growth rates have historically outperformed stocks with lower yields and
lower dividend growth rates.
And what could be
lower dividend growth moving forward (relative to that big 10 - year DGR) is compensated by a relatively high yield of 2.97 %.
Some investors like high - yielding stocks with
lower dividend growth while others like lower - yielding stocks with higher dividend growth, and some prefer a mix of both, but keep this basic guideline in mind.
Unless Cisco's long - term growth becomes somehow severely hampered, which would translate into
much lower dividend growth than what I'm forecasting, the stock looks undervalued.
For many companies, dividend growth comes in waves with high dividend growth for a few years followed
by lower dividend growth for a few years as the business cycle fluctuates.
And what could be
lower dividend growth moving forward (relative to that big 10 - year DGR) is compensated by a relatively high yield of 2.97 %.
Some investors like high - yielding stocks with
lower dividend growth while others like lower - yielding stocks with higher dividend growth, and some prefer a mix of both, but keep this basic guideline in mind.
Next we have dividend growth, DUK and ED has some of
the lowest dividend growth reaching only +2 %.
I use the S&P 500 dividends as
a lower dividend growth baseline.
The Chowder # of these stocks are lower because they have
lower dividend growth.
Not all investors in the Dividend Strategy as of 12/31/13 held all positions as of this date (specifically, newer investors who were not yet fully invested in the strategy and / or investors who have restricted us from investing in particular industries, did not own all positions as of this date) and therefore it is likely they achieved
a lower dividend growth rate in 2014.
Next we have dividend growth, DUK and ED has some of
the lowest dividend growth reaching only +2 %.
I look for a balance between lower yield / higher dividend growth and higher yield /
lower dividend growth and I gravitate toward the former simply because of my age.
As such, they often have high dividend yields and
low dividend growth.