What is the safest dividend stock?
Kinder Morgan (NYSE: KMI), Equinix (NASDAQ: EQIX), and Lockheed Martin (NYSE: LMT) are three super-safe dividend stocks because they generate contractually secured cash flow and have strong financial profiles. That makes them great options for those seeking to fortify their dividend income in 2024 and beyond.
| Stock | Implied upside from Feb. 7 close | Forward dividend yield |
|---|---|---|
| AbbVie Inc. (ABBV) | 12.6% | 3.5% |
| Bank of America Corp. (BAC) | 23.6% | 2.9% |
| Coca-Cola Co. (KO) | 8.4% | 3.1% |
| McDonald's Corp. (MCD) | 9.6% | 2.3% |
| Company | Dividend % | Ex-Date |
|---|---|---|
| NTPC Ltd. | 42.5 | 03-02-2023 |
| HCL Technologies Ltd. | 900 | 28-04-2023 |
| REC Ltd. | 32.5 | 09-02-2023 |
| Hindustan Zinc Ltd. | 1300 | 29-03-2023 |
According to Buffett, investors should strive to invest in companies with a strong dividend history rather than investing in the overall stock market. Likewise, he constantly advocates for value stocks priced lower than their intrinsic value.
| Stock | Market capitalization | Dividend yield |
|---|---|---|
| Cross Timbers Royalty Trust (CRT) | $104 million | 11.1% |
| Dynex Capital Inc. (DX) | $726 million | 12.2% |
| Horizon Technology Finance Corp. (HRZN) | $454 million | 9.7% |
| Permian Basin Royalty Trust (PBT) | $660 million | 4.2% |
| S.No. | Name | CMP Rs. |
|---|---|---|
| 1. | Guj. Themis Bio. | 349.45 |
| 2. | Refex Industries | 612.80 |
| 3. | Tanla Platforms | 985.50 |
| 4. | M K Exim India | 85.38 |
If you buy a stock one day before the ex-dividend, you will get the dividend. If you buy on the ex-dividend date or any day after, you won't get the dividend. Conversely, if you want to sell a stock and still get a dividend that has been declared, you need to hang onto it until the ex-dividend day.
| Stock (ticker) | Dividend Yield |
|---|---|
| McDonald's Corporation (MCD) | 2.3% |
| Automatic Data Processing, Inc. (ADP) | 2.2% |
| Microchip Technology Incorporated (MCHP) | 2.0% |
| Marsh & McLennan Companies, Inc. (MMC) | 1.5% |
Understanding the annual tax-free UK Dividend Allowance
You can earn up to £2,000 in dividends in the 2022/23 tax year and £1,000 for the 2023/24 tax year, before you pay any Income Tax on your dividends, this figure is over and above your Personal Tax-Free Allowance of £12,570 in the 2023/24 and 2022/23 tax years.
| STOCK | DIVIDEND AMOUNT (Rs) (TRAILING 1 YEAR) | AVERAGE DIVIDEND YIELD (%) |
|---|---|---|
| Taparia Tools Ltd. | 155 | 1111.11 |
| TV Today Network Ltd. | 73 | 33.11 |
| Vedanta Ltd. | 69 | 29.22 |
| Swastik Safe Deposit.. | 1 | 26.88 |
What is Warren Buffett's favorite stock?
Apple Inc.
Apple is the world's most valuable public company and Warren Buffet's largest stock holding. Under the leadership of CEO Tim Cook, Apple has continued to provide outstanding value to long-term shareholders.
One downside to investing in stocks for the dividend is an eventual cap on returns. The dividend stock may pay out a sizable rate of return, but even the highest yielding stocks with any sort of stability don't pay out more than ~10% annually in today's low interest rate environment, except in rare circ*mstances.
Buffett follows the Benjamin Graham school of value investing which looks for securities with prices that are unjustifiably low based on their intrinsic worth. Buffett looks at companies as a whole rather than focusing on the supply-and-demand intricacies of the stock market.
The truth is that most investors won't have the money to generate $1,000 per month in dividends; not at first, anyway. Even if you find a market-beating series of investments that average 3% annual yield, you would still need $400,000 in up-front capital to hit your targets.
NextEra Energy (NYSE: NEE) and Johnson & Johnson (NYSE: JNJ) are elite dividend stocks. They've increased their dividends every year for decades, and that steady growth should continue in the decades to come. That makes them great dividend stocks to buy for a potential lifetime of income.
The Coca-Cola Company ( KO ) pays dividends on a quarterly basis.
| Stock | Implied upside over Jan. 17 close |
|---|---|
| Tesla Inc. (TSLA) | 39.2% |
| Exxon Mobil Corp. (XOM) | 24.8% |
| AbbVie Inc. (ABBV) | 11.1% |
| Chevron Corp. (CVX) | 13.2% |
| Stock | Forward price-to-earnings ratio (P/E) |
|---|---|
| Enphase Energy Inc. (ENPH) | 25.3 |
| Microsoft Corp. (MSFT) | 30.0 |
| Nvidia Corp. (NVDA) | 26.6 |
| Tesla Inc. (TSLA) | 57.6 |
- SoftBank Group Corp. (OTC:SFTBY)
- Palantir Technologies Inc. (NYSE:PLTR)
- CrowdStrike Holdings, Inc. (NASDAQ:CRWD)
- Tesla Inc. (NASDAQ:TSLA)
- Palo Alto Networks Inc. (NYSE:PANW)
The 4% rule states that you should be able to comfortably live off of 4% of your money in investments in your first year of retirement, then slightly increase or decrease that amount to account for inflation each subsequent year.
What is the 25 rule for dividends?
If the dividend is 25% or more of the stock value, special rules apply to the determination of the ex-dividend date. In these cases, the ex-dividend date will be deferred until one business day after the dividend is paid.
The 45 Day Rule, also known as the Holding Period Rule, requires resident taxpayers to continuously hold shares "at risk" for at least 45 days (90 days for preference shares, not including the day of acquisition or disposal) in order to be entitled to the Franking Credits as a franking tax offset.
- Altria (MO) ...
- Devon Energy (DVN) ...
- Dow Inc. ...
- International Business Machines (IBM) ...
- Verizon Communications (VZ) ...
- AT&T (T) ...
- Prudential Financial (PRU) ...
- Philip Morris International (PM)
Whether you want to live off dividends today or are investing for the long haul, the best way to build a dividend portfolio for steady income is to follow a simple set of risk management principles: Hold between 20 and 60 stocks to reduce company-specific risk. Roughly equal-weight each position.
| Ticker | Name | Yield |
|---|---|---|
| (WMB ) | Williams Cos. | 5.52% |
| (FCX ) | Freeport McMoran | 5.42% |
| (CM ) | Canadian Imperial Bank of Commerce | 5.30% |
| (BNS ) | Bank of Nova Scotia | 5.10% |
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