Dividend investing general /dig/

[Anonymous No.56457577]

What a spectacular day for 2 of my high dividend growth stocks, MSFT and V

>dividend aristocrats
https://www.nasdaq.com/stocks/investing-lists/dividend-aristocrats
>dividend achievers (10 year dividend increase history)
https://www.marketbeat.com/dividends/achievers/
>check dividend history, dividend growth history, payout ratio etc.
https://www.financecharts.com/
>dividend calendar
https://www.nasdaq.com/market-activity/dividends
>dividend growth calculator
https://dividendathlete.com/dividend-investing-
calculator/
>what are qualified dividends and how are they taxed
https://www.investopedia.com/terms/q/qualifieddividend.asp
>REITs
https://www.reit.com/what-reit
>power of dividend growth
https://www.investopedia.com/articles/basics/04/072304.asp

[Anonymous No.56457603]

Retard

[Anonymous No.56457614]

>>56457603
Why are you mad

[Anonymous No.56457724]

what's the catch of dividend stocks? besides taxes. some dividend stocks have very high yields, but they get taxed so much that you don't actually end up making that much money outside of a ROTH.

[Anonymous No.56457802]

Fords still cheap as fuck and pays a nice dividend, I’ve been accumulating for about 5 years and make a nice chunk every 3 months just holding. Not selling until $30 for those asking.

[Anonymous No.56457888]

>>56457724
The catch is dividends don't make money from nothing. They take part of a company's earnings and distribute them to you. If the company can get a better return on that money than you can you'd be better off leaving it with them to reinvest it and increase the value of your shares.

In extreme cases a company can end up cannibalizing itself by paying more than its entire earnings in dividends, having to issue new shares and take on debt to continue payments. The decline in share value can offset or even eclipse the dividend payouts in the worst case.

[Anonymous No.56457905]

>>56457888
How frequent is this during a pullback? I recall a lot of companies cutting dividends hard during 2008-2010

[Anonymous No.56457910]

>>56457724
Reliable income reduces risk premium, making divvy stocks more expensive relative to growth stocks in a sense. They can also underperform total returns during periods of growth. That's not to say growth stocks are better, just that divvy stocks serve the niche of reliable income / compounding during periods of low growth.

Tesla has gone nowhere in 8 months. But a flat divvy stock in the same duration has paid almost 3 quarters of annual yield.

Also you can evade divvy taxes by acquiring qualified divvies. They are taxed at your long term gains rate.

[Anonymous No.56457927]

>>56457888
This is why payout ratio is important.

>>56457905
Companies try not to cut divvies if they can, but it can help restore cash flows. Intel not too long ago said they'd cut 401k matching before the divvy. It's more a last resort thing. Usually companies will pause increases for a time before cutting. Exxon survived negative oil without cutting, but it really varies company to company.

[Anonymous No.56457967]

>buying divvies when treasury yields are 5%
lmao

[Anonymous No.56457973]

>>56457967
Dividends grow but treasury yields are locked in. I don’t want to hold something that’s only yielding 5% 15 years from now

[Anonymous No.56457978]

Oh yeah let me build a dividend portfolio of 2-4% yielding blue chip aristocrats and wait 30 years to retire!!! Sounds great! Or I could buy SCHD and wait 30 years also!!!!!

[Anonymous No.56457980]

>>56457614
I'm not.
Dividend investing is a strategy for idiots. Nothing wrong with that, but it is what it is. I believe it's important to acknowledge that off the bat.

[Anonymous No.56457993]

>>56457577

[Anonymous No.56458002]

>>56457973
Do know what happens to your underlying dividend stock if rates actually stay at 5%+ for 15 years?

And if rates are cut you sell the appreciated bond value and buy whatever the fuck you want after.

[Anonymous No.56458015]

>>56457993

[Anonymous No.56458019]

>>56457980
Your opinion isn’t worth much

[Anonymous No.56458028]

[Anonymous No.56458087]

>>56458019
Dividend irrelevance is not an opinion, but rather an empirically proven fact.
Dividend reinvestment tax inefficiency in a typical portfolio is not an opinion, but a mathematical fact.

My opinion is that you are a retard, and I have facts to back that up.

[Anonymous No.56458133]

>>56457905
Pullbacks can mess with the dividend for companies that stubbornly refuse to cut their dividend but you should be careful in general. For example if you bought $10,000 of T in 2016 you'd actually have less than $10,000 today despite receiving $5,000 in dividend payments.

You're seeing this now in REITs that by law have to pay 90% or more of their earnings as dividends. When money was cheap they could grow by borrowing money to buy real estate on credit. But now they with rates above 5% they're all leveraged to the tits and can't afford more loans. And they legally can't cut the dividend. So their only options are to stop growing, liquidate assets to "trade up" to better properties, or issue new shares. That's why their share prices are plummeting right now - either they're not growing or they're diluting ownership.

So a recession can be a trigger but it can happen even outside a recession. That's why "good dividend companies" look so boring. They keep strong balance sheets, modest growth, and uninspiring dividend yields around 1-4% because they know you can't just distribute money you don't actually have in the long run. Greedier companies who see dividends as a way to fund executive salaries and artificially raise the stock price do often wind up cutting dividends when the tide goes out or, worse, stubbornly refuse to cut dividends until it's too late and go bankrupt.

[Anonymous No.56458137]

>>56458087
> but rather an empirically proven fact.
May I see the peer reviewed evidence?

[Anonymous No.56458240]

>>56458133
>You're seeing this now in REITs that by law have to pay 90% or more of their earnings as dividends. When money was cheap they could grow by borrowing money to buy real estate on credit.
I saw them in 2019-2021, it was amazing. Didn't even know they were a thing until then because I was looking for a house. Big red flag for me, but bought anyways, and now trying to sell.

[Anonymous No.56458487]

>buy divvies
>stonk barely crawls up, gets outpaced by every broad index fund on the market
>make some of the difference back through the divvies
>it gets taxed as ordinary income
>you can't choose when you receive the income

Lel why would anyone fall for this?

[Anonymous No.56458492]

>>56458137
>May I see the peer reviewed evidence?
Feels futile considering you'll just ignore the mountain of evidence as everyone always does, but here you go:
>https://www.jstor.org/stable/2351143
Above is the original paper, and below is a summary that is likely more your speed:
>https://www.investopedia.com/terms/d/dividendirrelevance.asp
Here's a good video explaining the concept as well:
>https://www.youtube.com/watch?v=f5j9v9dfinQ

Rather than relying on something irrelevant like dividends, if you really must use some generic factor criteria to drive longterm investment decisions. I'd recommend you consider the Fama-French 5 factor model:
>https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2287202

Once adjusting for other factors, dividends become entirely irrelevant as a predictor of future stock returns:
>https://www.financialplanningassociation.org/article/journal/APR13-dividend-investing-value-tilt-disguise
>In this study, the dividend yield factor has been shown to actually detract from portfolio performance.
And one final video, pointing out the drawbacks of restricting investment options based on some arbitrary irrelevant criteria:
>https://www.youtube.com/watch?v=4iNOtVtNKuU

Hope this helps you see the light.

[Anonymous No.56458510]

>>56458487
My divvy stocks are doing great. Hell visa and Microsoft are some of my best performing stocks

[Anonymous No.56458515]

>>56458492
None of those are from reputable sources. Sorry you couldn’t make it work out

[Anonymous No.56458523]

>>56458515
>Nobel prize winner
>not a reputable source
LMAO. Have fun staying retarded.

[Anonymous No.56458542]

>>56458523
>muh good goy Obama award
wow you’re really bad at this

[Anonymous No.56458584]

>>56458542
In all seriousness though, this serves as a pretty typical example of why no one ever provides sources on this anonymous imageboard. It simply isn't worth it, just to get some one liner meme response from the same fucker who asked for it.

Luckily, I didn't really spend half an hour compiling those articles/videos just for you. I have no doubt you'll stay a retard forever. You went through great effort compiling a list of bullshit links yourself just to make this misinformed turd of a general thread. There's no way any amount of hard evidence will move you. You've already achieved such a high level of self-unawareness that you'll likely be permanently trapped inside your own mental bubble of misinformation.
That list forms the basis for my future copypasta. If you crosslink this dogshit to /smg/ ever again, you can now know what to expect.

[Anonymous No.56458592]

>>56458584
You can find confirmation bias for all of your retarded opinions. Don’t expect everyone else to blindly buy into whatever you happen to be shilling.

[Anonymous No.56458606]

Home Depot yearly dividend since 2012

2012: $1.16
2013: $1.56
2014: $1.88
2015: $2.36
2016: $2.76
2017: $3.56
2018: $4.12
2019: $5.44
2020: $6.00
2021: $6.60
2022: $7.60

[Anonymous No.56458697]

>>56458492
give me the tldr on all of this. i'm interested in dividend stocks since i like the idea of not having to sell the stock for income. i can eat the eggs from the chicken instead of butchering it for its meat.

[Anonymous No.56458715]

im thinking of betting on MMM and WBA, dont think they are finished yet?

[Anonymous No.56458743]

>>56458697
Dividends are stable income. As long as you’re investing in the right companies. Thankfully it’s public information and it’s easy to pick good dividend stocks

[Anonymous No.56458751]

>>56458697
Also read this
https://www.bhagwad.com/blog/2023/personal/financial-matters/dividends-are-not-irrelevant-when-a-stock-becomes-an-nft.html/

[Anonymous No.56458865]

>Dividends are stupid unlike digital scam coins and physical scam coins.

[Anonymous No.56458886]

>>56458240
I made the same mistake. It's giving me some practice on cutting losing positions, at least. I've exited about half of the more speculative positions at non-awful prices so far and I'm hoping the stronger names might respond well to a rate cut in 2024 for a decent exit. I didn't plan on them being swing trades but here we are, you know?

Good luck to you anon!

[Anonymous No.56459919]

>>56458697
>tldr
I'd recommend you watch the video or read Investopedia, but here are the three core points:
1.) Dividends are fundamentally irrelevant. Removing cash from the balance sheet has no fundamental effect on stock value. In principal, you can expect the stock price to decline on ex-div matching the value of that divvy.

2.) Dividends have no predictive power once you remove for other factors that sometimes align with dividend players. A major factor is value, for which I provided a direct example of a study.
Divvy shills will point out that there are multiple studies of course, including plenty of lazy studies out there which simply look at an aggregate comparison of all stocks, separate into two categories, and determine that dividend payers pay more. This is intuitively pretty obvious - just look at all the dogshit microcaps/pennystocks out there that pay no dividends.
But again this is irrelevant, as there are other factors that better indicate future return potential and explain away the entirety of the difference.

3.) As a side note, high yielding dividend stocks actually correlate slightly negatively as a factor against total returns. This is independent of the typical major factor categories. I wouldn't take this as a blanket reason to avoid dividend payers either, however. There are numerous great businesses out there that both do and do not pay dividends and the effect is not substantial.
As an example, PBR has been a great divvy stock to hold the past few years despite maintaining 20%+ yield during that time, and I myself am a shareholder.

[Anonymous No.56460659]

Every time you buy a dividend stock, a shill kill xerself

[Anonymous No.56461769]

>>56458715
I mentioned WBA a month or so ago in /smg/ and still think they have some upward trajectory. They recently ousted their CEO so hopefully whoever they bring in will turn things around. If they can at least run things with partial competence there’s no reason it shouldn’t be valued roughly where CVS is

[Anonymous No.56462110]

>>56461769
did CVS get sued into obilivion too?

[Anonymous No.56462276]

>>56459919
> principal, you can expect the stock price to decline on ex-div matching the value of that divvy
Yes but it doesn’t require the shareholder to part with any shares. If you plan on just selling stock eventually you are going to run out of shares

Who listened when I was discussing NEE last week. You always buy when current dividend yield is so much higher than the historical average. NEE was beaten down but the fundamentals were still strong. One good earnings report later and it’s up 8% in a day. Luckily I snagged some last week

[Anonymous No.56462293]

>>56458002
Depends on the stock. Some go down, some go up. There are plenty of dividend paying stocks with fantastic records that date back to before 2008, when rates were higher.

[Anonymous No.56462354]

>>56458492
>investopedia article talks about a theory that dividend payments have no impact on stock price, meaning your stock price is the same as if you weren't paid a dividend but still got a payout on the side

Did you read any of this or did you just Google "dividend irrelevance"?

[Anonymous No.56462356]

>be dividend degenerate
>get mocked out of /smg/
>make your own general
>get mocked in that one too
Dividends? Dividont's

[Anonymous No.56462389]

>>56462356
Your screeching isn’t taken seriously. Sorry that dividends make you so upset

[Anonymous No.56462395]

how much to allocate to REITS and bonds?

[Anonymous No.56462407]

Where do i invest my 130$ for dividend kingdomhood. First step for a retard.

[Anonymous No.56462416]

Historically, dividend stocks perform better in market downturns. Downturns are terrible for growth stocks that don’t pay a dividend. When the market is down your dividends buy more shares at a cheaper valuation app without cutting the dividend. There is a robust history of easy to find companies who have raised their dividend every year, even through recession, downturns, and market panic events.

[Anonymous No.56462435]

>>56462395
Personally I don’t touch bonds. REITs should be in your high yield basket so I’d say no more than 15%. I say this even as O is 80% of my Roth. $48 was a gift so I liquidated most positions and bought in. All of my future contributions are going to core companies and fast dividend growth companies while I let O DRIP.
>>56462407
2 shares of SCHD. Make SCHD or another good low expense ETF the foundation of your dividend portfolio

[Anonymous No.56462446]

>>56462389
How many times do we have to tell you that chasing dividends is retarded?
>https://www.bogleheads.org/forum/viewtopic.php?t=406429

[Anonymous No.56462511]

>>56462446
You posting random excerpts that fit your world view while ignoring the utility of dividends is changing anyone’s mind. Enjoy your stay in /dig/ you obsessed schizo

[Anonymous No.56463458]

SCHD under $69. That’s a great value

[Anonymous No.56463631]

Check out the NFT known as GOOG. Imagine bagholding such a shitty stock and getting $0 back in the form of dividends

[Anonymous No.56463837]

>>56462446
Dividends themselves aren't very important to your overall bottom line but they do change the way you get there and that can be helpful for some people. For example, it suits some active traders to work with dividend stocks because the ex-div date gives them more events / news they can trade around.

It can be true at the same time that dividends for their own sake don't matter but that they do have some properties that can be useful to some people.

[Anonymous No.56463867]

>>56463837
Dividends provide stable, growing income. There will always be utility in that

[Anonymous No.56464298]

GGGGGGGOOOOOOOOOOOOOOODDDDDD MOOOOOOOOOOORRRRRRRNNNNNNNNNIIIIIIINNNNNNNNNNNGGGGGGGGG NNNNNNIIIIIIIIIIIIIGGGGGGGGGGGEEEEEEEEEEEEEEEEEEEEEEERRRRRRRRRRRRRRRRRRRRSSSSSSSSSSSSSSSSSSSSSSSS

[Anonymous No.56464618]

>>56462276
>Yes but it doesn’t require the shareholder to part with any shares. If you plan on just selling stock eventually you are going to run out of shares
If you have 10 shares in a company with 100 shares total, you have the same ownership as holding 100 shares in a company with 1000 shares.
When a company is actively buying back shares, you can sell some and maintain the same overall percentage of ownership. Oftentimes, these companies will do share splits over time, resetting the nominal share count.

For some strange reason, dividend shills tend to be incapable of comprehending this idea.

[Anonymous No.56464879]

>>56464618
That is a great comparison in a vacuum. What happens when an investor needs a little cash but the market has been in decline for a few months? The underlying stock might have depreciated in value and now you have to sell some to taste cash. The companies fundamentals might not have changed it’s just down due to the market being down. Pretending dividends are irrelevant will always be a losing battle. For some strange reason anti-dividend shills tend to be incapable of comprehending this idea

[Anonymous No.56465241]

>>56464879
>What happens when an investor needs a little cash but the market has been in decline for a few months? The underlying stock might have depreciated in value and now you have to sell some to taste cash.
Same thing happens when a stock that's declined pays a dividend. If a stock paying a 5% dividend declines by 5% after paying it, then the same stock that has crashed in half will pay a 10% dividend and decline by 10%.
You can view this as a discount, or the beginning of a total collapse. Either way, it's irrelevant to your decision to sell some shares

Oftentimes, companies actually pause their dividends after such a large decline. Sometimes the logic will be that they'd rather take advantage of the volatility and buy back stock rapidly during a heavy discount. Other times, it's to preserve capital. Regardless, the divvy bros sitting around blindly relying on that steady payment into their bank account end up getting fucked. Ironically, such stocks actually tend to reverse and start outperforming the moment they cut their divvy, just as divvy bros are calling it quits and bailing on what they see as a failed holding

In the end, it is up to the investor to decide how to monetize their position and extract cashflow. You can steadily sell down shares at a consistent rate such that you will never need to do a large sale at what may be a temporary bottom. You can maintain a balanced portfolio with some portion of cash so that you have the ability to rebalance and increase shareholding during periods of decline, while slowly adding to your cash stack during the good times
Divvy bros love making up imaginary hypotheticals such as this to try and defend the idea that you must outsource all the work of investment to blind trust in a company's own shareholder return policy. However, if you just use your brain for but a moment, it is clear that dividends make no fundamental impact. There is no hypothetical you can come up with where dividends offer tangible advantage

[Anonymous No.56465350]

The ultimate irony is that this same poster who's baiting with this same tired argument is, in this very thread, recommending anons reallocate their cashflow towards a dividend payer that has been in terminal decline.
He understands the concept of averaging down, of rebalancing, yet he selectively turns off his brain to fabricate some imaginary argument where dividend stocks might make the difference, as if investors are incapable of making rational decisions for themselves.

If he had simply read Merton's 1961 paper, he would know this is impossible. Dividends are, in fact, irrelevant.

[Anonymous No.56465479]

>>56458087
Dividends are a risk management strategy, you are taking profits off the table as you earn them. Imagine a company that is wildly successful for a number of years then reverts to the mean. The stock goes from 10 to 25, and back down to 10 again. With no dividends you got nothing for all the good years, unless you timed the markets well. With a dividend you at least got something.

Tldr: dividendsAreIrrelevant crew are hyper-autists who understand math but not business.

[Anonymous No.56465548]

>>56465241
>Same thing happens when a stock that's declined pays a dividend.
Absolutely incorrect. The share price will drop by the dividend for the millisecond that it’s paid out. If a companies stock price is down and you sell that’s it. And when it recovers only the stock you didn’t sell recovers. If a companies share price is down and they pay you a dividend, you can reinvest it and buy in at a cheaper price. When the stock recoveres you now get to ride up your initial investment + the new shares from the dividend reinvestment. That’s why dividend stocks do s much better than growth in a down market. You’ll never be able to overcome this fact no matter how many hugbox articles you find on Google.

[Anonymous No.56465550]

>>56465479
In theory you could imitate this with a growth stock by designating your own quarterly "ex date" where you sell shares or partial shares to "distribute a dividend" to yourself. But only a certified psychopath would actually run their portfolio that way.

[Anonymous No.56465596]

>>56465550
>just sell shares in a good company
kek no, I’ll take the more reliable and ever growing dividend.

[Anonymous No.56465629]

https://www.investopedia.com/articles/fundamental/03/102903.asp

[Anonymous No.56465640]

LOWEER
LOOWEEERRR

[Anonymous No.56465668]

>>56465548
You're such a moron it's not even worth replying with actual information. You're simply incapable of processing basic concepts like cash in a corporate balance sheet vs personal cash holdings. I hope you know that everyone is laughing at you.
All the information has already been laid out on the table, should you choose to partake in real learning. For the meantime, I'm going to be focusing my efforts towards other posters in this misguided general, some of whom may have a viable possibility of attaining enlightenment.

[Anonymous No.56465680]

So many posters in this thread be hatin;, y'all aint my /dig/gahs

[Anonymous No.56465685]

>>56465668
Yeah you got confused, posted a bunch of links and now we’re all laughing at you. GOOG baggies ladies and gentleman

[Anonymous No.56465697]

its over bobros its under 4200 and its not moving.
they fixed the index again
looks like the fucking bottom again

[Anonymous No.56465714]

>>56465680
This graph empirically proves the relevance of dividends. Nice

[Anonymous No.56465759]

>>56465550
>only a certified psychopath would actually run their portfolio that way.
The beauty of this statement is that by describing a process that is functionally identical to receipt of a dividend, you've indirectly revealed the truth: Dividend investors are irrational. They're some kind of psychopaths. Rather than reallocate their capital according to some logical system, they prefer to form these cultish circles, ritually praising the reoccurring quarterly/annual miracle that is the movement of cash off the corporate balance sheet and into their pockets.

One of my previous links actually covered this phenomenon as well: The relevance of dividend irrelevance.

[Anonymous No.56465770]

>>56465759
Please stop talking to yourself using your phone and laptop. You lost, it’s ok

[Anonymous No.56465805]

How do divvy haters explain private businesses
>own small business
>pay self regularly with payroll
>end of the year have profit
>reinvest the profit,give yourself a nice bonus, or a mix of both
You really have to break it down Barney style for the anti divvy retards for them to grasp that the purpose of a business is to return capital to investors

[Anonymous No.56465890]

who the fuck is buying

[Anonymous No.56465977]

>>56465890
Anon I’m sorry I was kidding when I linked this thread at the end of last /smg/. You’re in /dig/

[Anonymous No.56466003]

>>56465977
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA

[Anonymous No.56466010]

dont get sucked into high yield etfs anons
i went in big time on TSLY and ill never recover

[Anonymous No.56466244]

>>56466010
Covered call ETFs tend to be terribly destructive, and also incredibly tax inefficient.
It's odd because you wouldn't expect volatility to be systemically underpriced, and in fact shorting volatility in general tends to be profitable on average over time, despite large hiccups occasionally. Perhaps it is purely the upside vol that is overpriced, whereas covered call ETFs are a bet against downside vol.

[Anonymous No.56466245]

>>56466010
That’s quite obvious. I would never suggest buying into a covered call strategy, especially one that is only a few months old. You don’t want to chase high yield. You want high dividend growth

[Anonymous No.56466359]

>>56466010
I put $500 because it's hilarious and i'm down over $100 and it's still hilarious so i think i'll keep holding for now but yes you're right that it's an awful investment

[Anonymous No.56466432]

>>56465759
By your logic apple share price should be a lot higher since they sit on a shit load of cash.
You bash dividends, but have not provided any alternatives. I do find it suspicious with people like you spending abnormal time and effort "debunking" things you don't agree with.

[Anonymous No.56466442]

>>56458606
Is you saying that a stock that I bought for 45 bucks in 2012 would have made me $43 and I could sell that same stock for $235 in profit?? My $4.500 investment would have made me $4.300 and I could sell all that for a $23.000 in profit? wow you have to be a retard to turn $200 into $28.000!!!
>>56466244
>13pbtid
nigga, we get it! you dont like dividends. let as be retards and put our money into dividends. you spend way to much time into something you are not invested in.

[Anonymous No.56466679]

>>56466442
>let as be retards and put our money into dividends
If you want to be a retard, I can't stop you, but I will set aside some effort to help others avoid becoming retarded. I felt the same about BBBY which eventually became BBBYQ and is now just zero.

I have nothing against dividends by the way. I hold plenty of divvy stocks, just not on the basis of some imaginary advantage offered by the distribution of those dividends.

[Anonymous No.56466817]

>>56466679
There are advantages to holding dividends. We’ve told you in this thread. They can be used to mitigate risk. Boom there’s an advantage

[Anonymous No.56466838]

>>56466432
>You bash dividends, but have not provided any alternatives
There are three alternatives:
>companies reinvesting to grow the business, build out new segments, purchase competitors, pursue research, etc.
In this case, your ownership of the company changes because the company is no longer the same company it was the day before. As the company expands, you can sell some shares and maintain similar financial interest. All else equal, a company reinvesting entirely towards growth will be able to spend more on growth than an equivalent "dividend-growth" stock, which necessarily is deploying some capital towards dividend payments. However as an individual you can sell some shares to participate in part of the growth while also generating some personal returns for other spending or reallocation.
>companies buying back shares.
Fundamentally this is equivalent to paying dividends for reasons I've previously explained. I highly recommend you engage with some of the sources I've provided.
>companies sitting on cash
This is typically indicative of poor capital management, but sometimes is priced into the valuation. You can actually scale up your own holding size, possibly on leverage, to effectively negate the cash balance and maintain the beta exposure you desire.
Interestingly you're noting AAPL as an example of this, yet the large gains for apple occurred when they stopped sitting on the cash due to changes in tax policy under the Trump administration, and started aggressively buying back their shares from a relatively low forward-valuation.

If you need a real world example of non-divvy capital returns, I present you with this direct example of a company heavily buying back shares: AZO.

[Anonymous No.56466875]

>>56466838
Basic common sense will tell you that stock repurchases only make sense when the share is trading at below its intrinsic value. The same principles of investing apply when purchasing your own shares, as when you buy those of another company. Ideally, a company is in a better position to know the intrinsic value of its shares, so wouldn’t companies buy back their shares at attractive prices? But this doesn’t happen.

If the thesis is true, then share buybacks should increase during recessions and lowered prices, and decrease during bull-runs, right? After all, if share prices are depressed beyond reason, then it’s the perfect time to pick up your own shares on the cheap. The truth is that the reverse happens.

>executives often claim that buybacks are financial investments in undervalued shares that signal confidence in the company’s future as measured by its stock-‐price performance. But as we have seen, over the past two decades major US companies have tended to do buybacks in bull markets and cut back on them, often sharply, in bear markets
-profits without prosperity

In short, buybacks are losing you money, and overpaying for stocks, benefiting those who sell their shares at the expense of loyal shareholders. And why? All to pump the stock price that enables corporate executives to benefit from stock-based metrics like EPS, either directly through performance incentives, or indirectly through meeting analyst expectations.

[Anonymous No.56466881]

>>56466817
I'm not sure why you continue replying to me. I've already stated I won't waste further time conversing with you, as any insights offered would be lost upon your dull mind.
Please consult Mertons paper from nearly a century ago as it pre-emptively refutes whatever nonsense argument you think you're constructing.

[Anonymous No.56466887]

>>56457980
retard

[Anonymous No.56466907]

>>56466881
This coming from the retard suggesting massive companies just reinvest ol of their profit without actually having a way to capitalize on that reinvestment. Also lmao just sit on cash or participate in seedy buybacks that benefit the top brass. You’ve lost

[Anonymous No.56466965]

God damnit NEE is up another 3% today. Biweekly contribution doesn’t hit until next week

[Anonymous No.56466966]

>>56458087
Does any of this change if you reinvest the dividends to get some compounding effect going?

[Anonymous No.56467002]

>>56466966
He’s going to say no and show you a comparison between a dividend stock with dividends reinvested and SPY but that chart will be from a 10 year bull market and it won’t take into account that for dividend investors, total return is mostly a vanity number because we buy companies that we don’t plan on selling. The real thing that matters to a dividend growth investor is growing your annual dividend income. That’s it

[Anonymous No.56467034]

>>56466966
No. Stock buybacks also have a compounding effect.
Growth compounds as well, assuming the investments towards growth are successful and lead to increasing profits down the line, which themselves can be reinvested.
Look how large BRK is, and consider that they do not pay a dividend and have only recently started considering share buybacks.

Technically dividends are actually at a compounding disadvantage due to tax impacts on a typical portfolio, although in an IRA dividends offer a small advantage thanks to Biden's 1% buyback excise. This advice may not apply to companies/residents in other jurisdictions.
Dividend irrelevance does not account for tax impacts.

[Anonymous No.56467054]

>>56467034
>Stock buybacks also have a compounding effect.Growth compounds as well
Oh really? May I see

[Anonymous No.56467186]

>>56466838
>companies reinvesting to grow the business, build out new segments, purchase competitors, pursue research, etc.
You can do all those things and pay a decent dividend. I'd argue growth, innovation and staying relevant is required to maintain a healthy dividend growth.

[Anonymous No.56467281]

>>56467186
You can, but the dividend is not a necessary part of the equation nor is it relevant to the end result.
Dividends are neither good nor bad, they are irrelevant.

>>56467054
>Oh really? May I see
I'll be generous. You can have one more reply. Take a look at this long term chart of AZO returns, driven heavily by both buybacks and organic growth.

[Anonymous No.56467297]

>>56467034
>Look how large BRK is, and consider that they do not pay a dividend
Because they keep all that sweet dividend generated from all the companies they hold for themselves.

>Berkshire Hathaway received $6.04 billion in dividend income, up from $5.06 billion in 2021 and $4.89 billion in 2020

[Anonymous No.56467313]

>>56467281
>Dividends are neither good nor bad, they are irrelevant.
Not if you want passive income.

[Anonymous No.56467356]

Dividends are relevant for illiquid stocks. Dividends might have an advantage because of taxes, your own irrational psychology, or similar reasons. But outside of such things, dividend irrelevance is settled. >>56458492 points to the facts.

[Anonymous No.56467438]

>>56466881
let corps keep the money goy its better!

[Anonymous No.56467492]

>>56467438
You're confused. Maybe it's better for the company to keep the cash or maybe it's not. But either way, the market is pricing in the effects better than you.

[Anonymous No.56467512]

Best way to buy dividends in UK?

[Anonymous No.56467517]

>>56467492
lol very efficient lmao even
kys faggot

[Anonymous No.56467599]

>>56467517
If you could exploit the market so easily, you'd be enjoying your trillions of dollars, not posting on an Indonesian cinema forum.

[Anonymous No.56467628]

>>56467492
Market speculation is susceptible to irrational emotions and largely irrelevant if you invest in sound businesses as they'll be given their due anyway.

[Anonymous No.56467663]

>>56467599
lol this guy actually thinks markets are efficient :')
how many times does it have to be debunked for you people to start realizing its not the 80s anymore

[Anonymous No.56467700]

>>56467356
I believe you now that you switched devices and samefagged your confirmation bias post. Hilarious you would think that people wouldn’t notice the sperg stopped posting and a new person convieniently showed up to fight his battles

[Anonymous No.56467708]

>>56467599
argument: what color is your bugatti lmao

[Anonymous No.56467807]

>>56467700
Probably a bot. I refuse to believe a real person spend time writing all that shit that is supposedly irrelevant, but at the same time he "have nothing against dividends by the way. I hold plenty of divvy stocks". And then shills buybacks!

[Anonymous No.56467821]

>>56467807
Dividends provide safe, and steadily rising income year in and year out. People who try and replicate dividends get fucked when they have to sell during a downturn. His inability to grasp that is what makes him such an LOLcow

[Anonymous No.56467947]

>>56467700
>now that you switched devices and samefagged your confirmation bias post.
If you're referring to me, I'm still here.
>a new person convieniently showed up to fight his battles
The reason I stopped posting is that there are no new facts to bring to the table, and it's mostly the same fags posting, those of you who never had any interest in listening to facts and logic.

[Anonymous No.56467956]

>>56466679
Than just make a thread explaining all the bad things about dividend investing? This should be a thread for people that are interested in dividend investing and that want to learn more about effective ways to do that. There is a good chance that anyone interested in dividend investing has already seen the fors and againts for dividend investing. You have brought nothing new. The same links keep coming up every time someone asks about dividend investing. You are shitting up the thread.

[Anonymous No.56468047]

Any COST bros here? It’s right up there with V and MSFT as a quality dividend grower. Small initial yields with huge dividend growth plus share accumulation is a great combination. All have very low payout ratios and 10 year annual dividend growth histories above 10%.
Now might be a good time to remind you guys of the 72 rule. Simply put, divide 72 by the annual dividend growth % and that’s how many years it will take to double the yield of your i ritual investment. For example

Stock xyz has an annual dividend growth rate of around 11% and a 1.1 starting yield.
72/11= 6.545
It will take 6 years to double that yield to 2.1%. You might be thinking why wait all of that time for a 2% yield? It’s simple, yall be ahead of the game. No other 2% yielding company is going to have that fast rate of dividend growth and low payout ratio.

[Anonymous No.56468072]

>>56467947
the FACTS are in!

[Anonymous No.56468531]

>>56468072
lol. You could try and contest my facts, its just that you're not. None of you have done any research on this topic, at all.

[Anonymous No.56468716]

>>56467512
RIO or something

[Anonymous No.56469057]

>>56458002
they would go up as earnings grew. that's what companies do, grow over time.
and all companies perform better in the long term when rates are fixed, no matter the level. many easily fail when rates are fiddled with, this way and then that, every 2-3 years, at the whim of the government.

[Anonymous No.56469099]

>>56467628
That's an evasion. There's noise in market prices, yes, but -- as you said -- the signal shows itself eventually. If you know that non-dividend stocks are, on average, scammy and massively overvalued, you can bet on that belief and make huge amounts of money over time.
But you won't do that because there's a wise voice in your head that knows your claims about non-dividend "NFT stocks" are probably wrong.

[Anonymous No.56469175]

>>56467663
I'm not making claims about the stock market being efficient. I'm claiming (1) "dividend stocks are massively undervalued relative to non-dividend stocks" is something you can bet on and, in expectation, make lots of money from if it's true and (2) it's not true.

[Anonymous No.56469210]

>>56467297
>he still has no response to this

[Anonymous No.56469231]

>>56458592
He isn't the one shilling Dividends.

[Anonymous No.56469854]

>>56469231
Yeah I know he’s a retard

[Anonymous No.56470619]

ABBT

[Anonymous No.56470624]

>canadian banks still shitting the bed
I'm tempted to wait a bit longer before buying more

[Anonymous No.56471206]

Friendly reminder the only advantage of dividend stocks compared to the rest of stock market is they flip your thinking from net worth into yield making you less likely to sell during downturns.

Also if you have less than 1mil liquid already you are ngmi by stacking dividend stocks.

[Anonymous No.56471236]

>>56471206
Source? I don’t believe you

[Anonymous No.56471740]

>>56471206
>Also if you have less than 1mil liquid already you are ngmi by stacking dividend stocks.
Luckily the average american is now a millionaire.

[Anonymous No.56472023]

>>56469175
Dividend stocks are closer priced to their intrinsic value and their business will typically be more scrutinized by investors.
Speculation and betting can of course generate large profits, but most traders (gamblers) lose money and you're fool making it the core of your portfolio. Most people lose money trying to time the market, fomo'ing and panic selling, don't take profits when overvalued, instead of investing long term.

>>56471206
Net worth is mostly meaningless if you don't realize gains. It shit your mindset from speculation on the market to investing in sound businesses.

Passive income (dividends) and compound effect is an easy and safe way to build wealth and financial independence, which is likely why there are shills here. Yes, it take some time depending on how frugal you are or how much new capital you can add, but the reward will be a large net worth generating loads of cash.

[Anonymous No.56472690]

Dividends

[Anonymous No.56472708]

>>56457577
I made 14% this year selling covered calls alone. Why would I waste my time with 3% dividends lmao

[Anonymous No.56473003]

>>56466244
They can be if you yolo everything into them, but they are stable at the very least. I tend to at least allocate a portion of my traditional 401k into them and use that money to either roll further into said ETFs or by a broader market index (VOO for example) or other actual companies like KO. I’ve been eyeing WBA like a hawk simply because they’re going to have new leadership and it could bring them out of the gutter. That’s one company that offers a fat yield with potential for actual growth this this guy actually cleans it up. Alternatively, as it’s already been said, they’re good to pile into during times of uncertainty until shit stabilizes market wide.

[Anonymous No.56473803]

>>56472708
I sell covered calls on my dividend portfolio. I don’t make 14% tho because I’m extremely cautious

[Anonymous No.56474621]

NEE up another 2% today. 10% on the week. Yield is 3.2%. Still a good price in my opinion. The historical yield is about 1.5%

[Anonymous No.56475614]

[Anonymous No.56476347]

Anyone buying individual stocks instead of SCHD, whats your reasoning?

[Anonymous No.56476464]

>>56476347
Yea, and because I like to own certain companies. They are as follows
>COST
>V
>MSFT
>PEP
>NEE
>JNJ
>O

[Anonymous No.56476521]

>>56476347
This is in my roth and this is how much I buy biweekly. It evens out to $290 biweekly which equals $7000 so I can max it out next year when the contribution limit raises to $7000

[Anonymous No.56476531]

>>56476347
A lot of the companies in SCHD are bad. I only want to buy good companies.

[Anonymous No.56476532]

>>56476347
>>56476521
Whoops forgot the pic

[Anonymous No.56476573]

OP, you have to understand that most of /biz/ is young, 18-22 year old poor neurodivergent idiots sitting in their mom's basement or ghetto apartment. They can't wrap their head around something like dividend investing because they're so suicidal and immature they can only comprehend a get rich quick scheme using the $100 they earned from pizza delivery tips or birthday money. Maybe 2-3% of this board actually has the income or maturity to do something like investing in. Dividend stocks and have to pay off. The rest of this board will call you a retard because they unironically think a 1000x is normal and they're just unlucky, that it's only a matter of time before they pick "the next shib" and can be millionaires.

[Anonymous No.56476679]

>>56457577
plantin money trees out here brah, send over them ducats 'mo at 52 week lows

[Anonymous No.56476916]

>>56476573
>18-22 year old poor neurodivergent idiots sitting in their mom's basement or ghetto apartment.
>suicidal and immature
>can only comprehend a get rich quick scheme using the $100 they earned from pizza delivery tips or birthday money.
this hit so close to home i feel personally attacked. except i don't even get the fucking birthday money.

[Anonymous No.56477238]

so, are typical dividend companies/ETFs a good investment strategy?

Lately i've seen people say dividend investing is for retards and you should rather invest in growth stocks, and they cite dividend irrelevance, which seems to have been taken out of context. from what i've read, dividend irrelevance is just a theory that says there's really no difference in the value of the company if it decides to pay a dividend or not.

on the other side, someone said dividend investing is for retards, and cite "the income factory" as the best investment strategy, wherein dividend yield is what matters, not growth, so it's better to have mixed investments that have good cashflow, such as covered call ETFs, REITS, bonds, etc.

I like the idea of dividend investing since i can just eat the eggs without selling the chicken, but is this an inferior long term strategy?

[Anonymous No.56477318]

>>56477238
I would argue it’s the superior long term strategy. When I invest I want to share profits with the companies I’m investing in. Income is what’s important to me because eventually I want me and the wife to be able to quit our 9-5 jobs and get some easy part time work and live off of dividends. I hate the idea of just index investing and trimming 4% yearly hoping the money doesn’t run out. To me dividends offer peace of mind

[Anonymous No.56477336]

>>56477238
compare SCHD total returns of the last 10 years with QQQ returns.

[Anonymous No.56477345]

>>56477336
Last ten years was a tech heavy bull market. Thatd be a really weird comparison. Plus total return is a vanity number for dividend investors. Growing income is more important to us

[Anonymous No.56477356]

>>56477345
just saying that you might get better returns on the long term.
tech should dominate in the coming decade too. why should it not?

[Anonymous No.56477520]

>>56477238
They're not a BAD investment strategy but they're also not obviously better than just buying and holding SPY or QQQ.

It's hard to know how covered call ETFs and similar high-distribution instruments will work in the long run because they're so new. It might not be a coincidence that they're really hot right now after a pretty flat year or two since covered calls are expected to perform best in a flat-to-slightly-bullish market.

More typical dividend portfolios seem to lose a little in total returns for the benefit of having automatic liquidity and a small measure of recession resistance.

But really it's hard to make a broad generalization. Paying a dividend might be the right call for one company and not another. Some companies that pay dividends go to the moon and others don't. Unless you have a good reason to prioritize liquidity in your portfolio (like expecting to need to pivot or rebalance frequently or needing steady income to live on in retirement) you should probably just focus on trying to maximize total returns by buying the most profitable companies. If they pay a dividend, great. If they don't, also great.

[Anonymous No.56478098]

Yield on cost is a cope that doesn't factor in opportunity cost of the market value of your assets. Not that there's anything wrong with 3% real yield investments

[Anonymous No.56478375]

My retirement strategy is to live off dividends in retirement

I do expect my portfolio to generate decent total returns over the long-run, driven by earnings growth and dividend reinvestment

However, I have been around the block a few times to see long periods of time where share prices went nowhere

The only returns during those times came from dividends

A couple of long periods where prices went nowhere include:

1965 - 1982

2000 - 2012

Prices went nowhere in both periods, despite growth in earnings per share. That's because valuation multiples shrunk during those periods. That's a problem in the short run if you are selling stock to pay for expenses in retirement. This is why I prefer to focus on the relative stability of dividends over the fluctuation in share prices. I focus on what I can predict (dividends), over something I cannot (share prices).

Hence, for as long as those dividends covered expenses, the investor would have been able to do well and survive

Dividends are more stable, easier to predict and much less volatile than share prices. Dividends also grow faster than the rate of inflation over time. This makes them the ideal source of retirement income for me.

It is also important to keep investment costs low in terms of taxes and advice. If you have to pay a 1% fee on assets when prices are going nowhere, your portfolio value is slowly going to be eroded. If you are also not smart when it comes to tax planning, your portfolio income and balance would suffer.

[Anonymous No.56478499]

>>56477318
I'm leaning toward this.
>>56477336
>>56477520
>SCHD 10 year 11.13%
>QQQ 10 year 17.38%
quite a difference, but then again, it doubled since 2020 from all the money printing. I've seen an argument presented that growth stocks/etf's are glorified NFTs. Essentially, what good is owning Google if you receive no income from it and just hold it like an NFT? In order to realize the gains you'll have to sell it, but there's 0 utility in owning it. The number might grow bigger, but networth is essentially meaningless if there's 0 cashflow/income. How do you respond to this?

[Anonymous No.56478947]

>>56478499
> In order to realize the gains you'll have to sell it, but there's 0 utility in owning it. How do you respond to this?
You could consider a non-distributing stock to be more speculative than a distributing stock but it's not that different. If you wanted you could set up your very own "Google ex div date" on the 15th of months 1, 4, 7, and 10 and sell 1% of your shares at market to receive cash just like a dividend. Likewise, you never know for sure if the next dividend distribution from JNJ is actually coming or not.

The actual difference in "realness" isn't between dividend stocks and growth stocks, it's between any stock and speculative assets like NFTs or bitcoin. Google's stock entitles you to a share of Google's real estate, servers, employees, websites, and so on. The productive capacity and immediate liquidation value of those assets is what makes your share valuable. If the worst happens and nobody wants youtube anymore there will be plenty of people interested in buying the youtube server farms for other purposes because they're useful for productive work. There is some speculation about the future productive value of these assets but the more profitable the company is already the less guess-work is needed here.

Compare that to what you're entitled to if you buy the Google NFT rather than the Google stock. You'd be entitled to a jpeg with a blockchain address. Blockchain jpegs don't make products and services for profitable cashflows, they just sit there. Their value is entirely contained in what somebody will pay for it as a novelty item.

Stocks entitle you to ownership of real world assets with productive and liquidation values whether or not they pay a dividend. NFTs do not.

[Anonymous No.56478958]

>>56478947
> If you wanted you could set up your very own "Google ex div date" on the 15th of months 1, 4, 7,
What if the market is down? That’s not equivalent to a dividend

[Anonymous No.56478979]

>>56478947
> you never know for sure if the next dividend distribution from JNJ is actually coming or not.
Yes you do, JNJ is AAA rated. It’s more reliable than the US government. If JNJ doesn’t pay its dividend the financial markets would be the least of your problems because that means an extinction level event has happened. Sounds dramatic but that’s just the way it is

[Anonymous No.56479096]

>>56478958
>What if the market is down? That’s not equivalent to a dividend
Lots of companies lower their dividends when the market is down. Or you could sell a fixed dollar amount per share you own if you prefer to imagine that your imaginary Google dividend is never reduced. Say $1 per share.
>Yes you do, JNJ is AAA rated.
What do corporate bond ratings have to do with choosing to pay a dividend? Companies decide on distributions quarterly. Unless you own majority share of the company then you have no guarantee the dividend won't stop sometime in the future, and even if you do own a majority share the company could go bankrupt in which case obviously the dividend stops. Being a big, stable, well-respected company doesn't mean this won't happen. Polaroid was a blue chip stock until it fell 98% in 2 years and de-listed.

[Anonymous No.56479995]

>>56478947
>If you wanted you could set up your very own "Google ex div date" on the 15th of months 1, 4, 7, and 10 and sell 1% of your shares at market to receive cash just like a dividend.
this is possibly the dumbest anti-dividend take i've ever heard
verification not required

[Anonymous No.56480050]

>>56479995
reading my post as much as the captcha i see

[Anonymous No.56480075]

>>56458028
>BMO
more like based-mo

[Anonymous No.56480215]

>>56457577
Dividends are gay. I have 30% in SCHD and I'm down 6%, even with the 3.5% dividends. Everything else in my portfolio is up.

[Anonymous No.56480413]

>>56480050
Sorry, i'll go back and review

[Anonymous No.56480478]

>>56479096
> Lots of companies lower their dividends when the market is down
Not good companies. And they’re easy to find. That’s the beauty of dividend investing. You don’t have to guess

[Anonymous No.56480494]

>>56480215
How long have you been invested? SCHD is a long hold. When it’s down I just buy more.

[Anonymous No.56480499]

>>56463631
Imagine giving a substantial amount of your hard earned money to blackrock, at all. Fuck tradfi and everyone sustaining it.

[Anonymous No.56480687]

>>56480215
Dividends are not bad. Just irrelevant.

[Anonymous No.56480726]

>>56478958
>What if the market is down
Dividend-paying company is also down and is down more compared to a company which does not pay dividends. What's your point?

[Anonymous No.56480747]

>>56480726
>Dividend-paying company is also down
And that’s a good thing because the dividends still keep rolling in and you get to buyback in at a better valuation.
>and is down more compared to a company which does not pay dividends
The opposite is true at least for the most popular dividend stocks. I’m surprised you didn’t know that

[Anonymous No.56480898]

Don’t forget to bump this thread while I’m sleeping.

[Anonymous No.56480974]

>>56480747
>The opposite is true at least for the most popular dividend stocks
Alright, so dividend companies have less pronounced moves.

Nice way to dodge my initial question anyways

[Anonymous No.56481017]

>>56480974
>Nice way to dodge my initial question anyways
thanks

[Anonymous No.56481054]

>>56480898
There's only so much to talk about

[Anonymous No.56481072]

>>56457577
Literal ponzi stocks. If you’re in profit don’t be the last to sell.

[Anonymous No.56481852]

>>56479096
>Lots of companies lower their dividends when the market is down.
Some companies may halt increase or cut the dividend if the broader ECONOMY is down causing decreased profits and free cash flow. The market is not the economy, it's a reflection of future expectations.

[Anonymous No.56483284]

>>56481072
Cope

[Anonymous No.56484697]

Page 9 how about page 1

[Anonymous No.56485816]

[Anonymous No.56485846]

>>56483284
hi, how can I cope with the fact I own 0 (zero) stocks, barely $10k to my name, and all charts look like my erected dick pointing to the fucking sky

[Anonymous No.56485871]

>>56485846
There are lots of deals on divvy stocks today. JNJ is a big one

[Anonymous No.56485887]

>>56485871
>JNJ
> 351.64B
> -10%
Oh shit what a discount. Are you making this comment based solely on the fact that we have massive inflation since 2020 so the stocks should be higher?

[Anonymous No.56485902]

>>56477238
If you are afraid of price performance then pick a growth stock with a small dividend like MSFT, that way you still get high returns and a little bit of passive income

[Anonymous No.56486289]

Growth stocks always beat dividend stocks because you can always sell while the price is in decline and buy back in while the prices inclines.
>or script your custom homebuilt handtrained ai to watch the market closely and automatically make those optimally timed moves for you

[Anonymous No.56487372]

SCHD bros I dont feel so good. Is there another 30% decline coming so that the dividend goes to 5%?

[Anonymous No.56487462]

>>56486289
Share the AI anon