Sunday, July 17, 2011

Dividend Investing: 4 - Consecutive Years of Dividend Raises

I continue my series on dividend investing by looking at something I have talked a lot about in other videos, the consecutive years of dividend raises...

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

I want to expand and clear up something I mentioned in the video. That was how a dividend company vs a non dividend company grows and expands their business.
Now I am not saying that non dividend companies expand recklessly. But when they choose to grow they are not restricted by having to increase the dividend the next year. So their moves can be longer term or if their expansion is not as profitable as they thought then no big deal, they will work it out later.

The dividend paying company though has to be sure it will start generating income to pay for the higher dividend. It could take a few years before any growth will see increased income from any one expansion of buying another company or building a new factory. This forces the company to plan out more so they have several projects in the pipe. They also have to really be sure that they are on target because if there are delays then they will not have enough growth to increase the dividend and investors could become concerned or start to sell.

Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others.
I am not a financial planner, financial advisor, accountant, or tax advisor. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

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