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Finding stocks

How to find good dividend stocks

A good dividend stock pays a yield it can afford and raises it over time. Look for a yield of roughly 2-7 %, profits and cash flow that cover the payout, and a long record of paying.

By the Ticker Picker team

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Why the highest yield is rarely the best

The dividend yield is the yearly dividend divided by the share price. When a share price falls because the business is in trouble, the yield shoots up - often just before the dividend is cut. A yield far above the industry's is a question to answer, not a bargain.

What to check

The payout ratio (the share of profit paid out) should leave room: below about 60-70 % for most companies. Free cash flow should cover the dividend. A long streak of paying and raising the dividend shows management's commitment, and moderate debt means the dividend does not depend on borrowing.

Using the screener

The Steady dividend profile looks for large companies with a 2-7 % yield, a calm share price and positive earnings, ranked by yield. Add the dividend streak or dividend growth columns to see who has kept paying - and open each company to check its payout and cash flow.

Try it in the screener

The Steady dividend profile shows large companies that pay a regular dividend. It is a learning example, not a recommendation.

Show steady dividend stocks

This content is general information, not investment advice.