06-24-2016, 11:51 AM
I left the following on the article, but will post it here for the sake of discussion:
Great article, and I appreciate the research that went in to it.
The takeaway statement for me was the following: "In other words, a 1% yielding company that grows its dividend and earnings at 9% annually has the same expected 10% annual returns as a 6% yielding company that grows at 4% or a 3% yielding company growing at 7%."
To me, I prefer lower-yielding, higher growing stocks (think DIS, V, etc) as opposed to higher-yielding but slower growing stocks (such as T, SO, etc), although my portfolio is about 50/50 between the two. I generally take dividends from the slower growing, higher yielding companies and invest in the lower yielding, faster growing companies. The benefit of this strategy is that I will realize more capital gains in addition to the dividend income.
But, to each his own. Know thyself. Thanks for the article.
Great article, and I appreciate the research that went in to it.
The takeaway statement for me was the following: "In other words, a 1% yielding company that grows its dividend and earnings at 9% annually has the same expected 10% annual returns as a 6% yielding company that grows at 4% or a 3% yielding company growing at 7%."
To me, I prefer lower-yielding, higher growing stocks (think DIS, V, etc) as opposed to higher-yielding but slower growing stocks (such as T, SO, etc), although my portfolio is about 50/50 between the two. I generally take dividends from the slower growing, higher yielding companies and invest in the lower yielding, faster growing companies. The benefit of this strategy is that I will realize more capital gains in addition to the dividend income.
But, to each his own. Know thyself. Thanks for the article.