While I appreciate growth stocks (and have a range of them in my portfolio), I am also a fan of high dividend yield stocks - as long as the company is a quality one and the the dividend is sustainable and growing. While not necessarily tax optimal, the income helps to fund expanding of the number of shares, provides a buffer in case of downturns and ensures financial discipline in how the company is managed.
A couple of my highest paying div yield stocks (with modest P/E ratios)
I like Imperial Brands as well, also because they allow dividend reinvesting through corporate actions (i.e. no fees).*
Others that I currently like (setting the limit of âhigh dividend yieldâ arbitrarily at 6%):
British American Tobacco â 8.4% Plus: Continues to grow, steady dividend raises (in local currency), nice credit rating, keeps meeting earnings expectations. Minus: Long term debt at close to 40% â would be nice if lower. Requires patience for that eventual P/E expansion. Meanwhile wipe those wept tears away with your dividend checks.
Legal & General Group â 9.2% Plus: Continues to grow, steady dividend increases (local currency), awesome credit rating. Only little long term debt. Minus: A little cyclical (in earnings).
Altria â 7.7% Plus: What a beautiful earnings growth chart! I mean, look at this beauty â even steadier than Johnson&Johnson!** Great credit rating, keeps meeting earnings expectations. Minus: see my comment above for British American Tobacco.
SFL â 9.2% Plus: Nice yield, Bermudas listed (no US tax withheld, etc). Minus: Anemic growth, cyclical, no P/E expansion in sight. Highâish long term debt.
Bank of Novia Scotia â 6.3% Plus: Steady dividend raises, slow but overall steady growth, stellar credit rating. Only little long term debt. Minus: P/E expansion is for the patient ones only.
Mercedes â 8.5% Plus: High dividend yield? Awesome credit rating. Minus: Itâs a car company? Cyclical. Dividend yield just as cyclical. Iâve driven Mercedes, I donât like the car. Sorry.
ING Bank ⊠do I assume correctly that you mean ING Groep (www.ing.com)? â 6.9% Plus: Yield, credit rating. Minus: Long term debt, slowâish growth, unsteady earnings and dividend history.
I suspect (not sure) we have quite a few Americans here. As a European (non-Swiss but planning to stay in Switzerland forever) I prefer to not be too overweight in US$ denominated stocks.
I have a âderpâ portfolio thatâs equal splits $MO $BTI $IMB.L $PM and $2914.T Japan Tobacco, out of those five JT is the clear winner in terms of appreciation.
Rising stock prices and dividends are not mutually exclusive (Apple is a good example, even more with their massive buybacks).
Switzerland has cured me of âhatingâ taxes. They are relatively moderate here, the taxes are well spent, and as long as I pay no more than my fair share then Iâd prefer to pay as much taxes as possible.
Dividends can play a special role in various situations - for instance I am unemployed now and the dividends are (more than) enough to maintain a comfortable lifestyle AND continue to buy shares / ETFâs at the same time. It eliminates 99% of the worry of a market crash.
I believe thereâs also stats pointing to dividends structurally accounting for a substantial portion of the total returns for S&P500 (or other index) companies.
I am afraid that was a trivial answer that nobody wanted to voice Zurich and Swiss RE would be first two stocks that come to my mind when talking about high dividend for Swiss investors.
Reckitt Benckiser (in UK) - consumer goods with good yield and potential for PE expansion
Endesa (Spain) - utility
Vodafone (UK) - telco
RTL Group (Germany) - media, another opportunity for yield and PE / earnings expansion
Adecco (Switzerland)
I have no issue with âstableâ safe high div yield stocks. Even more so as i expand the return through writing covered calls as well as cash covered puts.
Durch das Lesen und die Teilnahme an diesem Forum bestÀtigst du, dass du den auf http://www.mustachianpost.com/de/ dargestellten Haftungsausschluss gelesen hast und damit einverstanden bist.
