Dividend Basics for Value Investorshttp://www.fool.com/investing/value/2008/09/30/dividend-basics-for-value-investors.aspx Motley Fool Staff
September 30, 2008
Historical records show that more than 50% of the long-term return from stock investing has come from dividends. As you contemplate growth rates, future cash flows, pending patents, FDA approval, or international expansion at the companies you follow, remember that there are only two ways to get paid from the stock market: the "buying low, selling high" method, and dividends.
Not only do dividends give you cash in hand or more shares in your account, they're a powerful indicator of the company's cash-raising abilities and management confidence. Indeed, most of the businesses we look for in Motley Fool Inside Value sport healthy dividends.
A dividend yield is simply the annual dividend divided by the share price expressed as a percentage. For example, consider the recent yields for the following companies:
Source: Yahoo Finance.
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