Why Dividends Matter

Today, Fool.com analysts Anand Chokkavelu and Matt Koppenheffer review Anand's decision to hang on to his shares of Philip Morris despite short-term weakness in the shares today.

Though the 3.7% dividend the company pays investors every year isn't as big as that of other tobacco companies, it's still far higher than the market average and is a huge boon to the long-term investor because of the power of compounding interest.

While hot growth stocks get all the attention, the historically resilient nature of tobacco dividends means they could help you retire rich.

You can read about three more in our premium report "3 Stocks That Will Help You Retire Rich," where we name stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to start reading.

Anand Chokkavelu, CFA, owns shares of Philip Morris International and Altria Group. Fool contributor Matt Koppenheffer and The Motley Fool have no positions in the stocks mentioned above. 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.


Read/Post Comments (2) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 21, 2012, at 6:49 PM, mansourg54 wrote:

    MO is best dividend stock. This week's Barron's magazine has a long article about SABMiller beerand its departing chairman. MO owns 28.3% of the company which amounts to around 450 million shares. SAB pays a dividend that yields 2.5% at a share price of approximately 36-42 results in a dividend amount of approx. $1.0 which means MO collects close to $450 million annually in SAB dividend money which MO distributes to its shareholders.

  • Report this Comment On October 21, 2012, at 7:39 PM, NickD wrote:

    I own my own company stock 28% of it .

    My company makes 100.

    I keep 28.

    I pay 72.

    or

    I own 0% of my company.

    My company makes 100.

    I keep 0.

    I pay 100%

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2067356, ~/Articles/ArticleHandler.aspx, 10/25/2014 1:54:09 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement