When evaluating stocks, there are literally hundreds of different metrics you can use, ranging from the basic to the specialized. Some metrics carry more weight than others, and this is especially true when evaluating dividend stocks.

For example, if a stock's payout ratio, dividend-growth rate, and interest coverage look bad, I don't really care about metrics such as earnings per share, or the actual amount of the dividend payment. With this in mind, here are 10 of the most important metrics that all dividend investors should know and use when choosing stocks to invest in. I'll use two of my favorite long-term dividend stocks, Johnson & Johnson (NYSE:JNJ) and Wal-Mart (NYSE:WMT), to illustrate what they mean, and what they can tell you about a dividend stock's merits as an investment.

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All Johnson & Johnson and Walmart data was obtained from TD Ameritrade and is current as of 10/21/2015.


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Matthew Frankel has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Costco Wholesale. The Motley Fool recommends Johnson & Johnson. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.