Nowadays, Everyone Is Getting Some Dividend Religion

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Do you have dividend religion? Do you need some? Stock trends come and go, but dividends meet the test of time. Put father time on your side and put the miracle of compound interest to work for you.

Karen Langley and Gunjan Banerji report in The Wall Street Journal on the market’s big boost for dividend stocks, writing:

Cash is king right now. The latest evidence: the market’s embrace of dividend-paying stocks over another longtime favorite, firms that do buybacks.

Investors are rushing to companies promising regular payouts to shareholders, a sign of Wall Street’s hunger for cash in hand as the Federal Reserve raises interest rates and major stock indexes struggle.

The S&P 500 fell 0.8% Tuesday while the Nasdaq Composite dropped 2.3% as a selloff in technology stocks intensified. Coming after major indexes rallied Monday, the declines were another example of the whipsaw trading confounding investors in recent months.

That has investors turning to companies such as AT&T Inc. and cigarette-maker Altria Group Inc. as the broader market endures one of its most volatile stretches of the past decade. Worries about rising interest rates, sky-high inflation and slowing growth turned the stock market upside down, leading many investors to ditch the highflying companies that dominated over the past decade—firms that often pay no dividend or only a small one.

Since the start of 2020, companies that pay high levels of dividends have continued outperforming those with lower payouts, while shares of companies putting the most money into stock repurchases have lagged behind those with the lowest buybacks, according to Credit Suisse analysts.

Action Line: If you need assistance crafting a portfolio of individual stocks focused on dividend income, I can help, just get in touch. If you want to learn more about the benefits of dividends, check out the Dividend Primer downloadable from the Richard C. Young & Co., Ltd. homepage. If you want to learn more about preparing your finances to protect your family, click here to sign up for my free monthly Survive & Thrive letter, where I help you do just that each month.

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E.J. Smith - Your Survival Guy

E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. His focus at all times is on preparing clients and readers for “Times Like These.” E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zildjians. He grew-up worshiping Neil Peart (RIP) of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West (RIP JB) and Paris. Please get in touch with E.J. at ejsmith@yoursurvivalguy.com To sign up for my free monthly Survive & Thrive letter, click here.

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