03-18-2013, 07:34 PM
So there has been a ton written about the importance of getting into your DG stocks at the right price. Even the best dividend streams are not worth overpaying for. I don't mean to say that no stock deserves a premium -- it makes perfect sense to me that KO would generally trade at a higher multiple than, say, an oil stock or a tech stock.
And of course it would be dangerous to consider dividend yield in isolation. But after I have done a fair bit if analysis of one of my prospects, I like to have a look at its historical dividend yield, and I get excited when I see that it is at the high end of its own range. This could happen because of a recent dividend raise, or because the price of the stock is at the lower end of its range, or other factors. But if I am confident that the price is not on its way down for specific reasons, then seeing a dividend yield in the high end on the stock's range makes me think it could be a good time to buy.
Is this something that others consider? What do you think?
And of course it would be dangerous to consider dividend yield in isolation. But after I have done a fair bit if analysis of one of my prospects, I like to have a look at its historical dividend yield, and I get excited when I see that it is at the high end of its own range. This could happen because of a recent dividend raise, or because the price of the stock is at the lower end of its range, or other factors. But if I am confident that the price is not on its way down for specific reasons, then seeing a dividend yield in the high end on the stock's range makes me think it could be a good time to buy.
Is this something that others consider? What do you think?