5 High-Yield Dividend Stocks to Watch
Dividends often replace earned income upon retirement, so identifying the best yields within reason is an important step to maximizing your lifestyle. Moreover, stocks that distribute cash to shareholders tend to be more stable; they are usually mature companies with sufficient financial health and limited growth opportunities that would necessitate earnings retention. This stability is ideal for retirees who want to avoid major swings in asset value.
Dividends are also useful for providing returns through market downturns. Companies that maintain dividends through a recession will continue to pay shareholders even if the market value of the stock is low. These stocks often outperform during bear markets for that reason.
It's important to focus on those characteristics when identifying the most attractive dividend stocks. High yields are preferable for obvious reasons, but they need to be sustainable too. Businesses with predictable performance, steady long-term growth, and demonstrated commitment to returning capital to shareholders are going to deliver the most reliable dividends, and the best stocks will appreciate with strong performance as well.
Source Fool.com
