Some would argue that dividend growth — the rate at which a dividend is increasing — is a more important predictor of
returns than dividend yield.
Not exact matches
You can think of the «
return» on this investment as the value of paying yourself, rather
than a landlord, even if it's not paying
dividends or increasing in value.
Since 2012, when the company launched the largest share repurchase program ever, Apple has
returned a little more
than $ 100 billion to shareholders in stock buybacks and
dividends.
Buying back stock is, for example, Warren Buffett's preferred way of
returning cash to shareholders (rather
than paying a
dividend).
Buffett is right that, for most of his stock - picking history, shareholders have likely been better off leaving their money in his care rather
than siphoning the cash into their own accounts by way of
dividends: Since 1965, Berkshire Hathaway stock has delivered annualized
returns of nearly 21 %, more
than double the S&P 500.
My reasoning:
Return would be lower
than Dividend Investing above because index funds need to hold stocks yielding 1 and 2 % as well as those yielding > 3 %.
Such
returns are much better
than the average private equity, CD, bond market, P2P lending, and
dividend investing
returns.
If you've ever had occasion to look into the academic research comparing different types of
returns from stocks that have different characteristics, as a class,
dividend stocks tend to do better
than the average stock over long periods of time.
While stocks are riskier
than bonds or cash investments, they have much higher
returns over the long run and many issue
dividends on top of this.
MarketCap / GVA is better correlated with actual subsequent S&P 500 total
returns than price / forward earnings, the Fed Model, the Shiller P / E, price / book, price /
dividend, Tobin's Q, market capitalization to GDP, price / revenue and every other valuation ratio we've developed or examined in market cycles across history.
There are alternatives that can protect investors from future inflation that are less volatile (TIPS) or offer a better
return profile (REITs and even high quality
dividend stocks)
than commodities.
The thing is, the alternative to
dividend investing — investing for total
return — will get you even more money
than a
dividend investing strategy ever will.
On a total
return basis, the Safest
Dividend Yields Model Portfolio (+0.3 %) rose less
than the S&P 500 (+2.9 %) and underperformed as a long portfolio last month.
On a price
return basis, the Safest
Dividend Yields Model Portfolio -LRB--2.6 %) fell more
than the S&P 500 -LRB--0.6 %) and underperformed as a long portfolio last month.
Throw in the most recent year's $ 365 billion in
dividends, and the total amount
returned to shareholders reaches $ 885 billion, more
than the companies» combined net income of $ 847 billion.
The 15 - yr annualized
return for the S&P 500 Index, including
dividends, is less
than 5 %.
I have to imagine that for most investors their overall stock
returns will be greater sticking with
dividend stocks
than chasing those elusive multi-baggers.
If a company pays a
dividend equivalent to a 3 % yield, management is essentially telling investors they can't find better investments within the company that will
return greater
than 3 %.
So far I've more
than doubled my initial investment in the past couple years, much more
than the meager
returns offered by
dividend stocks.
For those investors who desire a monthly income with the flexibility of investment choice, and the potential for better
returns than achievable from a savings account, then investing into stocks that pay their
dividends monthly could be the answer.
Since total
return is comprised of income (via
dividends or distributions) and capital gain, with the former counting much more over the long term, the case for this stock having a great 2018 is certainly already there based on that higher -
than - average yield.
On the basis of nominal total
returns (including
dividends), we estimate zero or negative
returns for the S&P 500 on every horizon shorter
than about 8 years.
And, equally, that if you are getting say a 5 %
dividend yield on a a portfolio of shares then the excess income is not «free» — you are taking on more risk
than you think, or perhaps the capital
returns will be poor.
At 44.4 %, however, less
than half of the company's earnings are being
returned to shareholders via a
dividend, providing plenty of room for more increases going forward.
This ETF yields 3.4 % on
dividend, so saving small money into this ETF may provide a lot better
return than saving money in a savings account where we can receive 0.90 % APY only.
Over the long term,
dividend - paying stocks have delivered higher
returns with lower risk
than non-
dividend payers.
If you buy stock in an overvalued company, your
returns are likely to be less
than the sum of
dividend yield and
dividend growth.
Anyways, 11 % increase was achieved more by new investments
than dividend returns and additional investments are drying up this year.
We know that Warren Buffett's Berkshire Hathaway hasn't paid a
dividend in more
than 30 years because Buffett feels that the
return on capital that he generates by retaining those earnings will create eventual share price appreciation value for the shareholder that will exceed the share price /
dividend capital appreciation that his shareholders would receive.
Both the investment worth and the passive
dividend income grew at a rate of
return of more
than 11 %.
If, instead, you buy quality undervalued companies, your
returns may be greater
than the sum of
dividend yield and
dividend growth.
U.S. companies have been more generous
than ever in
returning excess cash to shareholders via
dividends.
The closest to this type of holding in our portfolio is Pepsi (PEP), which over the last three years has
returned more
than 90 % of its net income to shareholders in the form of
dividends and share buybacks.
Over the long term, companies that can consistently and reliably increase
dividends paid to investors offer higher
returns with less risk
than companies that do not pay a
dividend, or which do not consistently increase
dividends paid to investors.
It's only been a few months since I created the
dividend fund but the
return of 17.2 % has beaten the S&P 500 by more
than 3 % and that's not including the 1.35 %
return on
dividends collected so far.
We all know that time in the market is much better
than timing the market when it comes to compounding
dividend returns.
Whenever the S&P 500 total
return index fell more
than 10 % below its all - time peak, the Bargain Hunter portfolio took all accumulated cash and interest earned and invested it into the S&P 500, and earned the index's total
return with
dividends reinvested.
Our preference for how that capital is
returned is repurchase of undervalued shares since that adds more value
than a taxable
dividend would.
in the event that any
dividend and / or other form of capital
return or distribution is announced, declared, made or paid by Shire otherwise
than in the ordinary course, to reduce any offer by the amount of such
dividend and / or other form of capital
return or distribution.
On a 10 - 12 year horizon, we expect the total
return of the S&P 500 to fall short of 1 % annually, and given that more
than that amount is likely to represent
dividends, it follows that we expect the level of the S&P 500 Index to be lower 10 - 12 years from now
than it is today (recall a similar outcome after the 2000 peak).
Interestingly, if over the course of the forecast horizon, they go up and then revert back to where they are today, the effect on the
return will actually be negative, because there will be no net change in valuation, but some of the ensuing
dividends will have been reinvested at higher valuations
than those available today.
The finding appears to extend to the macroeconomic level as well — shareholders in the larger economy got a much bigger bang for their buck when cash was
returned to them as
dividends than when it was deployed into capital expenditure.
This will tend to understate the performance of the taxable account in circumstances where long - term capital gains and qualified
dividends, which are currently taxed at lower rates
than ordinary income, are a component of investment
returns, as is the case for investments with significant equity holdings.
27 of 94 Monthly Paying (MoPay) U.S.
dividend stocks were tagged «safer» by showing positive annual
returns, and free cash flow yields greater
than...
Graham recommends a stock having a
dividend history of longer
than 10 years, at which point a company has established a track record of consistent profits and
returns for the company's investors.
Keep in mind that HASI's has maintained a more predictable
dividend growth profile
than the mREIT peers, so from a risk /
return perspective, I consider HASI's platform more appealing.
Since the industry consolidated and management incentives changed to being based on
returns on capital rather
than growth, capacity (supply) growth has tracked GDP (demand) growth closely, free cash flow generation has been significant and consistent, and the companies have consistently paid down debt, bought back stock and paid
dividends.
When it comes down to it, in a stock market that is feeling more uncertain and volatile
than it has in several years, and when income vehicles are priced at a premium, there's a certain wisdom (or at least well - studied prudence) in considering a slightly lower
dividend in exchange for the potential for greater stability and long - term
return.
Most of those companies have more near - term ability to
return capital to shareholders through
dividends and share repurchase
than financial stocks do.
Although Graham might not have, I would exempt FB from Graham's third requirement for
dividends, as I believe Facebook's
return on investing moneyin their own business is higher
than the
return a shareholder would find with
dividends.