You should invest in large-cap stocks with high dividends if you want to receive more dividends. These stocks have high dividend yields and relatively low P/E. They generally have dividend yields of 3.4% or more. Below are 7 such stocks, each with a P/E ratio of under 20 and a dividend yield of over three percent.
Microsoft
Microsoft is a good choice if you are looking for a large-cap stock that can grow quickly and pays a healthy dividend. Microsoft's dividends have been increasing over time. In fact, the company's earnings per share have increased by an average 24% annually over the past 5 years. It has a low payout ratio which is ideal to dividend stocks. It is expected to raise its dividend by 10% per year for the next five-year period.
Microsoft pays dividends every three to four months, and four times per annum. Although the date of the dividend payment varies from month-to-month, it is usually within the third week. Potential investors need to know this date in order to complete their investment prior the ex-dividend day.
Johnson & Johnson
Johnson & Johnson, a large cap stock that pays a high dividend, is a good choice. Johnson & Johnson has a high dividend yield, at 2.4%, which is above the S&P 500 average. It also has a solid company model and a strong name. It has been a leader for years in health care. The company's shares are also highly appreciated each year. You might consider another option if you're looking to invest in a rapidly growing stock.
Johnson & Johnson has steadily brought new products to the market, and the company is now a leader in a number of health care categories. Today, the company's market cap is $435 billion, and it generates $98 billion in annual revenue. This makes it a megacap stock (market capital over $200 billion). It just reported its second quarter financial results and exceeded analysts' expectations. Its revenue increased 3% year-over-year to $24 billion and its adjusted EPS jumped from $2.59 to $2.68, which is a record high.
Lowe's
Lowe's might be the right stock for you if you're looking to invest in long-term income and have a solid dividend record. The company is known for its dividend growth, low payout ratio and healthy earnings growth. Lowe's has increased the payout for 60 consecutive year. The company is able to fund its dividend growth with low debt levels, and can execute share repurchases and invest in the business to fuel future earnings growth.
Lowe's offers a Stock Advantage Direct Stockpurchase Plan. This program allows new investors the opportunity to purchase Lowe's common stock. It also automatically increases existing investors' holdings. Participants also have the option of automatically reinvesting their dividends.
Target
Target is one of the best large-cap retail stocks for dividend investors. The company's current market valuation is low, but its growth prospects are excellent. Over the past 50 year, the company has increased its dividend every year and will likely continue this trend. Profits have also significantly increased.
The company has a clear strategy: it sells high-quality merchandise at discount prices and through digital channels. Although its competition is dominated by Walmart and Amazon, Target management believes that its stores can be a competitive advantage and help it to become a successful omnichannel retail chain. Target has made investments in supply chain logistics to improve efficiency and renovated its stores.
FAQ
How are securities traded
The stock market allows investors to buy shares of companies and receive money. Shares are issued by companies to raise capital and sold to investors. Investors can then sell these shares back at the company if they feel the company is worth something.
The price at which stocks trade on the open market is determined by supply and demand. The price goes up when there are fewer sellers than buyers. Prices fall when there are many buyers.
Stocks can be traded in two ways.
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Directly from the company
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Through a broker
What are some of the benefits of investing with a mutual-fund?
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Low cost - buying shares directly from a company is expensive. It is cheaper to buy shares via a mutual fund.
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Diversification – Most mutual funds are made up of a number of securities. One type of security will lose value while others will increase in value.
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Professional management - Professional managers ensure that the fund only invests in securities that are relevant to its objectives.
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Liquidity is a mutual fund that gives you quick access to cash. You can withdraw your money whenever you want.
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Tax efficiency: Mutual funds are tax-efficient. This means that you don't have capital gains or losses to worry about until you sell shares.
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No transaction costs - no commissions are charged for buying and selling shares.
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Easy to use - mutual funds are easy to invest in. You only need a bank account, and some money.
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Flexibility: You can easily change your holdings without incurring additional charges.
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Access to information - You can view the fund's performance and see its current status.
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Ask questions and get answers from fund managers about investment advice.
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Security - you know exactly what kind of security you are holding.
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You have control - you can influence the fund's investment decisions.
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Portfolio tracking: You can track your portfolio's performance over time.
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Easy withdrawal - You can withdraw money from the fund quickly.
Disadvantages of investing through mutual funds:
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Limited selection - A mutual fund may not offer every investment opportunity.
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High expense ratio – Brokerage fees, administrative charges and operating costs are just a few of the expenses you will pay for owning a portion of a mutual trust fund. These expenses will reduce your returns.
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Insufficient liquidity - Many mutual funds don't accept deposits. They must only be purchased in cash. This limits your investment options.
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Poor customer service - There is no single point where customers can complain about mutual funds. Instead, you must deal with the fund's salespeople, brokers, and administrators.
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High risk - You could lose everything if the fund fails.
How do I choose an investment company that is good?
You should look for one that offers competitive fees, high-quality management, and a diversified portfolio. Fees vary depending on what security you have in your account. Some companies don't charge fees to hold cash, while others charge a flat annual fee regardless of the amount that you deposit. Others charge a percentage on your total assets.
You also need to know their performance history. Companies with poor performance records might not be right for you. Avoid companies that have low net asset valuation (NAV) or high volatility NAVs.
Finally, it is important to review their investment philosophy. An investment company should be willing to take risks in order to achieve higher returns. They may not be able meet your expectations if they refuse to take risks.
What are the benefits of stock ownership?
Stocks can be more volatile than bonds. Stocks will lose a lot of value if a company goes bankrupt.
However, if a company grows, then the share price will rise.
To raise capital, companies often issue new shares. This allows investors to purchase additional shares in the company.
To borrow money, companies use debt financing. This allows them to access cheap credit which allows them to grow quicker.
If a company makes a great product, people will buy it. The stock will become more expensive as there is more demand.
The stock price should increase as long the company produces the products people want.
What role does the Securities and Exchange Commission play?
SEC regulates the securities exchanges and broker-dealers as well as investment companies involved in the distribution securities. It also enforces federal securities law.
What is the difference between non-marketable and marketable securities?
Non-marketable securities are less liquid, have lower trading volumes and incur higher transaction costs. Marketable securities on the other side are traded on exchanges so they have greater liquidity as well as trading volume. These securities offer better price discovery as they can be traded at all times. But, this is not the only exception. There are exceptions to this rule, such as mutual funds that are only available for institutional investors and do not trade on public exchanges.
Marketable securities are less risky than those that are not marketable. They usually have lower yields and require larger initial capital deposits. Marketable securities are generally safer and easier to deal with than non-marketable ones.
For example, a bond issued in large numbers is more likely to be repaid than a bond issued in small quantities. The reason is that the former is likely to have a strong balance sheet while the latter may not.
Marketable securities are preferred by investment companies because they offer higher portfolio returns.
Statistics
- The S&P 500 has grown about 10.5% per year since its establishment in the 1920s. (investopedia.com)
- Individuals with very limited financial experience are either terrified by horror stories of average investors losing 50% of their portfolio value or are beguiled by "hot tips" that bear the promise of huge rewards but seldom pay off. (investopedia.com)
- "If all of your money's in one stock, you could potentially lose 50% of it overnight," Moore says. (nerdwallet.com)
- Ratchet down that 10% if you don't yet have a healthy emergency fund and 10% to 15% of your income funneled into a retirement savings account. (nerdwallet.com)
External Links
How To
How to Invest in Stock Market Online
The stock market is one way you can make money investing in stocks. There are many methods to invest in stocks. These include mutual funds or exchange-traded fund (ETFs), hedge money, and others. The best investment strategy is dependent on your personal investment style and risk tolerance.
Understanding the market is key to success in the stock market. Understanding the market, its risks and potential rewards, is key. Once you understand your goals for your portfolio, you can look into which investment type would be best.
There are three major types of investments: fixed income, equity, and alternative. Equity refers to ownership shares of companies. Fixed income refers to debt instruments such as bonds and treasury notes. Alternatives are commodities, real estate, private capital, and venture capital. Each category comes with its own pros, and you have to choose which one you like best.
Once you figure out what kind of investment you want, there are two broad strategies you can use. The first is "buy and keep." This means that you buy a certain amount of security and then you hold it for a set period of time. Diversification, on the other hand, involves diversifying your portfolio by buying securities of different classes. If you purchased 10% of Apple or Microsoft, and General Motors respectively, you could diversify your portfolio into three different industries. Multiple investments give you more exposure in different areas of the economy. This helps you to avoid losses in one industry because you still have something in another.
Another key factor when choosing an investment is risk management. Risk management allows you to control the level of volatility in your portfolio. A low-risk fund would be the best option for you if you only want to take on a 1 percent risk. A higher-risk fund could be chosen if you're willing to accept a risk of 5%.
Knowing how to manage your finances is the final step in becoming an investor. A plan is essential to managing your money. A good plan should include your short-term, medium and long-term goals. Retirement planning is also included. Sticking to your plan is key! Don't get distracted by day-to-day fluctuations in the market. You will watch your wealth grow if your plan is followed.