Altria Group: An Amazing Dividend Stock, or a Dangerous Value Trap?
Cheap dividend stocks can seem like steals from afar. Not only are their valuations low, potentially setting investors up for big gains in the future, but their payouts can also be great sources of recurring income. While they can be enticing investments, it's always important to tread carefully with high-yielding dividend stocks, as they often come with risks.
One of the highest-yielding stocks on the S&P 500 belongs to tobacco giant Altria (NYSE: MO). At 7.5%, with this stock, you're getting a yield that is nearly seven times the rate of the average stock on the S&P 500, which pays 1.1%. Altria is also trading at a low price-to-earnings multiple of 13.
Is the stock a steal of a deal for income-seeking investors, or is it just a value trap that you should avoid?
Source Fool.com
