Find the Best Dividend Stocks...
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Finding the best dividend stocks requires you to look at each stock's valuation, not it's dividend yield. Here's how to do it. - Stock prices fluctuate with the general stock market.
You don’t know if a cheap stock is a good value unless you look at the numbers. - Invest in financially strong companies.
You want a high Current Ratio, Quick Ratio, and Operating (and Free) Cash Flow. You want a low Debt to Equity Ratio. - Invest in companies that have a future.
You want a low or medium
dividend payout ratio
, positive dividend growth rate, and positive sales growth. Also ensure the company demonstrates the ability to use its assets and equity efficiently. Finally, look at the company’s dividend history. You want consistent dividend distributions. You also want to avoid stocks that have abnormally high dividend yields. - Invest in a company when it is undervalued, meaning the stock is at the low end of its historical valuation ratio range.
Valuation ratios to watch are the Price-to-Sales, Price-to-Book, Price-to-Earnings, and Dividend Yield.
The stocks picked using these criteria have historically demonstrated the best performance. These are the best dividend stocks.
The Best Dividend Investing Books
One way to get expert advice is to make your self the expert. You do that by learning...through books. I have spent over 20-years studying various investment styles and strategies. I provide you with a very short list of the books that I believe to be the best.
CLICK HERE
to go to the page that lists the books that I think are worth your time and money.
The Best Investment Research Service For Finding Dividend Stocks
There is one investment research service that I use all the time when looking for the best dividend stocks. That service is called Value Line . They are regarded as one of the most respected investment research services and have been in business for over 80-years. They offer several different products but the three products I use are the Value Line Investment Survey, The Value Line Investment Survey – Small and Mid-Cap Edition, and the Value Line Investment Analyzer. Value Line is probably best known for its Timeliness Ranking System which ranks stocks based on their algorithm as a predictor for stock performance over the next six to twelve months. As a value dividend investor I do not rely on those rankings because I prefer to buy stocks based on discount to valuation. What I do like, however, is the breadth of stocks they track (about 1,700 in over 90 industries in the Investment Survey, plus 1,800 more in the Small & Mid-Cap edition). I cannot do without their Investment Analyzer because I can screen stocks using 300 parameters and up to 10-years of historical data. The Value Line Investment Survey includes regular updates to four model portfolios including one called "Stocks for Income and Potential Price Appreciation" and one model portfolio called "Stocks with Above Average Dividend Yields." Each issue also includes sections that help you identify the best dividend stocks based on valuation ratios I talked about earlier. For example, these are some of the standard screens you get with each update: - Highest Dividend Yielding Stocks
- Highest Dividend Yielding Non-Utility Stocks
- Stocks With the Highest Projected 3-5 Year Dividend Yield
- Bargain Basement Stocks (based on Book Value)
- Lowest P/E Stocks
- Stocks With the Widest Discount From Book Value
- Biggest Free Cash Flow Generators
That's six standard screens of deep value stocks. These are the screens that will reveal the best dividend stocks. I recommend you check out Value Line. It’s well worth the money if you are serious about your investment performance. They offer an inexpensive 13-week trial subscription so you can’t go wrong. Click here to find out more!  
Using Existing Lists
You can also use existing lists to help find the best dividend stocks.For example, The Dividend Aristocrats are the 25 S&P 500 blue chip companies that have increased dividends every year for at least 25 consecutive years. You can also look at the The Dogs Of The Dow. The Dogs of the Dow are the ten highest yielding stocks in the Dow Jones Industrial Average index.
Or...Read My Commentary
- Here are 3 safe dividend stocks yielding more than 3% (December, 2011)
Protecting Your Dividend Stocks Against Losses
You will need a way to protect your portfolio once you have found the best dividend stocks because even the best dividend stocks will suffer a loss when the stock market falls dramatically.Buy this book to learn a simple, effective, and low cost process for dividend investors like you and me. The hedging strategy I developed and discuss in this eBook uses put options to provide protection if the stock market falls while allowing a portfolio to continue growing if the stock market continues to go up.
CLICK HERE
to learn more about this book.
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