Investors have looked to dividend stocks to help them earn income from their portfolios and for their long-term growth. But thousands of stocks pay dividends. How can you pick the best ones for your portfolio?
In the following video, Dan Caplinger, The Motley Fool's director of investment planning, look at Altria Group (NYSE:MO), AT&T (NYSE:T), and HCP (NYSE:HCP) to see why they're such extraordinary dividend stocks. Dan notes that great dividend stocks have solid current yields, stable payout records, and a long-term history of growth. AT&T and HCP both qualify as Dividend Aristocrats, with nearly 30 years of annual dividend increases each. Dan notes that Altria would normally qualify as a Dividend Aristocrat but for its spinoffs of Kraft and Philip Morris International over the years, but it has paid more to shareholders each year for 45 years.
Dan goes on to talk about how the roughly 5% yields on these stocks outpace the rest of the market by a wide margin. More importantly, all three of these stocks have met the test of time, with Altria surviving tobacco litigation, AT&T having made it through the massive breakup of its former monopoly, and HCP navigating recessionary environments that have made things tough on its industry.
Fool contributor Dan Caplinger and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.