The Dividend Investor.
Part 1: Dividends do not lie.
Part 2: Dividend Shares.
Part 3: How to invest in dividend shares.
A variety of sites including stock brokers, offers information about the shares. All in different scopes, but the dividend yield shows probably the most. It may seem simple to at any of these sites sort up stocks with high or even maximum yield, which is probably not unusual. Really it is not that simple to invest in the shares generally or dividend shares specifically. Whether you are looking for at the dividend shares, or any other type of share it is important that you invest in a healthy good company. Just search for the share with the highest dividend yield can be a really bad location, in fact it is not rarely that bad shares is in the top among those with the highest dividend yield. The reason for this is that the yield is calculated at the previous year’s earnings and after that, it may have happened with the company which significantly degraded its prospects for the future. A reduction of the dividend, and poor share price performance is in the cards.
You can still make use of a search where it lists the companies according to how high the dividend yield. Such a list can be an okay starting point to sort on. From here you want to sort the presented companies with a business you believe in forward and you want to especially make sure that it is a great company with a sustainable dividend. Looking closer at the companies they now have in the list may, for example, directly to sort out those with a business you are not interested in. After that you can look at the companies history and key figures. The company has for a number of years raised or at least had an unchanged dividend? How large part of the profits represents the profit? The lower the proportion of earnings which the dividend represents, the better utdelningstäckning you say. It is good to have good utdelningstäckning and if the dividend represents only 50-60% of profits may be considered to be very good.
Probably you have now a fairly short list of companies, when from the beginning, sorted out the with a certain dividend yield and then sorted to remove those with business, but not like, sorted to remove those with a poor utdelningshistorik and the poor utdelningstäckning. This was put on all the world’s different criteria you could wish for. Looking to use dividend growth, we can sort out the companies that have not raised the dividend every single year a certain number of years. Some sites have all this information but sometimes you need to search for it yourself on each company’s site. A hot tip is to also verify the information before you finally invest. This is done with the respective companies, on its website or in the annual report.
With this short list of companies you can take a closer look at them, compare them with each other and examining its prospects for the future. It is future profits that will give you dividends and, therefore, it is important to try to form an idea of how the company’s future looks like. This is done by taking into account all possible factors you can use. Only the imagination sets the limits here really. They play a range of scenarios that can possibly harm or benefit the company. When you fantasized completed and determined that the company should have good times ahead of them, you can also take the help of historic figures. If the company has a clear trend of increasing earnings and dividends, it may be a part which provides support in that it could possibly continue to go well. You can have the benefit of imagination may sound really fuzzy but it is about to fantasize about the future. How is clothing in the future? To a greater extent online probably. How we will carry ourselves in 25 years? Maybe via a pool of self-driven cars. You pay monthly subscription and the number of cars in the world has decreased by 50 per cent. If you genuinely believe in the imagination, avoid be used with advantage companies in one way or another associated with the automotive industry. Only you and your imagination sets the limit for the bit that you actually can and should use in their equity research. With thoughts on the future, one can assess the valuation of the company.
Furthermore, it has now likely a very short list of companies that fit all your criteria and which, moreover, can be assumed to have a good future. Maybe you are investing in all of them if they are several or perhaps select the one that seems the best of the few that are left. The whole process is good to do running on existing holdings. In this way the follow-up that you should continue to take them, or perhaps possibly ought to sell.
This process is just a way to make its selection on, the point however, is that you must make a careful selection on all types of investment dividend shares. Sort well and remember to be extra vigilant with the shares that look to have the highest dividend yield.
Good luck with the sorting!