Investing in the stock market can take various forms, from chasing high-flying momentum stocks to seeking steady income from high-yield investments. However, a strategy that has gained popularity is dividend growth investing. This approach focuses on companies that consistently increase their dividend payouts year after year, indicating financial strength and stability.
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What is Dividend Growth Investing?
Dividend growth investing revolves around acquiring shares of companies that raise their dividend payments annually. This strategy emphasizes the long-term growth potential of undervalued dividend-paying stocks. Dividends are seen as a tangible reflection of a company’s earnings and financial health. A consistent rise in dividends demonstrates a robust business model and financial performance. -
Dividend Lists: Achievers, Contenders, Aristocrats, Champions, and Kings
- Dividend Achievers: Companies that have boosted dividends for at least ten consecutive years, with a minimum three-month average daily trading volume of $1 million.
- Dividend Contenders: Stocks increasing dividends between 10 to 24 years, comprising a smaller group compared to Achievers.
- Dividend Aristocrats: Firms raising dividends for 25 or more years and included in the S&P 500 Index.
- Dividend Champions: Similar to Aristocrats but with a minimum 25-year streak without the S&P 500 Index requirement.
- Dividend Kings: Rare companies that have elevated dividends for 50+ consecutive years, showcasing exceptional stability and consistency.
- Notable Dividend Growth Stocks
- Brown & Brown (BRO): A leading insurance brokerage firm demonstrating a strong growth trajectory due to its strategic acquisitions.
- SJW Group (SJW): A water utility company with a robust financial performance driven by increased revenue and customer growth.
In conclusion, when considering which stocks to invest in, quality is paramount. Identifying undervalued, high-quality dividend-paying stocks is crucial for a successful dividend growth investment strategy. The Simply Investing course provides essential guidance on recognizing these stocks and making informed investment decisions, ensuring long-term profitability and financial security.
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