“Ka-ching! Dividend investors live for that sound. Each quarter thousands of companies hand over their excess cash to investors,” Daniel Sparks writes for Seeking Alpha. “But not all dividend stocks are equal.”
In fact, some are straight up risky while others are extremely promising,” Sparks writes. “So how do you find an excellent dividend stock? It’s simple. Look for companies with loads of cash. Case in point, Apple — a dividend investor’s dream stock.”
Sparks writes, “There’s no denying it. Apple is an excellent dividend stock — maybe one of the best. If you can identify a stock out there with a dividend yield in excess of 2.5% that also scores higher than Apple on FCF-to-sales, cash per share, and payout ratio, I’d love to hear about it. Until then, Apple tops the list.”
Read more in the full article here.
Indeed.
This is where the difference between real investors and speculators/ traders, speaks volumes for itself, especially with Apple…
Serious long term Apple investors (many of whom are private investors) typically grow positions and accumulate shares over a long period of time, taking full advantage of unwarranted dips and of their first hand knowledge and faith in the company and it’s historical track record.
Sizable dividends go a long way to help withstand and weather market downturns and turbulence, by providing guaranteed quarterly dividend income – the more shares one has, obviously, the bigger the dividend payment and the offset to price drops can be substantial. It can even enable buying to increase a position.
In a downturn is the return really guaranteed? Can’t the company decide to lower the dividend?
It’s guaranteed for the stated commitment period and will be then reviewed and probably renewed if company continue at or close to current rates.
..if company continues making profits at or close…
Thx
A downturn in stock price does not mean anything about a companies sales, market strength or financial performance. Case in point is Apple. Apple will continue to pay dividends as long as their sales and profitability are good. Stock prices are routinely manipulated in the Wall Street Casino. The Feds should disband the SEC and hire the Nevada Gaming Commission to regulated those clowns.
I was happy with the dividend last year and the increase this year is fantastic. At least Apple has control over the dividends to shareholders, but there’s nothing Apple can do about its share price. That’s in the hedge funds’ hands. I’d like to see Apple’s share price go up another $100 or so and it certainly seems possible with a new iPhone and a China Mobile contract. I might complain that Apple isn’t selling as many iPhones as Wall Street expects, but I think Apple can come back even stronger if they really get serious about selling iPhones. Only time will tell. If there’s any company that has the resources to do it, Apple certainly leads the pack.
I’m somewhat surprised that more institutions haven’t jumped on board, but maybe they’re just waiting for a great catalyst to take place. Meanwhile, the institutions seem to have quite a number of stocks other than Apple they can own to make money by way of share gains.
Happy with the dividend too.
“Apple can come back even stronger if they really get serious about selling iPhones”
Have they not been? After having just walked in and sold millions of iphones and sent the likes of Nokia, Research in Motion kaput??
“a China Mobile contract”
That could be the one thing that pushes the stock price up again. Besides technical issues/difficulties withy the cellular network, I think the one thing still “breaking” the deal is related to that possible revenue sharing request from Apple.
We should not forget these other factors or potential price catalysts:
– iPhone is not the only pony Apple has in store.
– Revenue can come from iPads, iMac, Mac Pro, MacBook Pro/Air, iPods, all the iTunes stores, Apple TV.
– New products, obviously the most important factor
“I’m somewhat surprised that more institutions haven’t jumped on board, but maybe they’re just waiting for a great catalyst to take place”
I’m surprised too; and like many of those institutions I’m waiting for that great catalyst too. It is really really difficult seeing Apple not coming out with that iTV or that iWatch, or that iSomething, but please “hurry”.
Yes, time will tell… (our wait was worth it).
Patience and a strong stomach are two components of successful investing. Apple is a closely watched and often is-represented company by the media and punditocracy. Its stock is a target for manipulation by hedge funds and speculators.
So what can an individual Apple investor do to win?
As the Taliban (who I detest) like to say, and I’ll change their quote here, “The hedge fiunds own the watches, but we have the time.”
To win, be patient. Reinvest your dividends. In time, all the hype will be irrelevant. And your reinvested shares will trump all the BS games the speculators and manipulator a like to play. Tune out the noise. Be patient. You will win.
Dividend reinvestment is a great way to increase holdings at no cost. Essentially I am adding 2 shares per quarter to my holdings for free. With the recent drop in share price the value is better. My original investment will be paid back in 5 years.
I can’t complain and if the stock goes up again then the value will be even better.
@ Breeze, LB48 and others,
I second all your comments and thanks for some of your insights. I’ve been long AAPL since Jan. 2005 — my only regret is that I didn’t have extra funds to purchase more during the drops in 2008, etc. I also watched the share price climb from 14 in March or April 2004 to 90 just before the last split in Feb. 2005 (coincident with the introduction of the iTMS). The split announcement finally pushed me to make a move — and I’m thankful I did.
I wonder if Goosung pays any dividend…