If you're serious about making money in the stock market, you need to start thinking like an owner, not a trader. Owners know two things that traders generally overlook:

  • A share of stock represents a partial ownership position in a company.
  • Over time, that company's operational results determine the wealth it generates.

Or in other words, when companies make money, their shareholders benefit.

Rocket science it's not
Nowhere is this connection more obvious than with reliable, dividend-paying businesses. Dividends are the most direct way a company can reward its investors for the risks they've taken by investing.

As important as the payment itself, however, is the message a dividend sends to the world. When a company initiates a dividend, it essentially announces that it has more than enough cash to reward its owners. In fact, a dividend is probably the clearest signaling device in any company's arsenal.

Keeping the message strong
To see how well some firms do at signaling their fiscal strength, here's a list of firms from the "half-century" club -- businesses that have been paying dividends without interruption for more than 50 years:



Paid without

Allete (NYSE:ALE)



Empire District Electric (NYSE:EDE)



Snap-on (NYSE:SNA)



Otter Tail (NASDAQ:OTTR)






Public Service Enterprise Group (NYSE:PEG)



General Electric (NYSE:GE)



Some of these companies can trace their consistent payments back a century -- or more! Just some of the "knock the world for a loop" events that couldn't derail the dividends from the longer-lived of these great firms include:

  • World War I
  • The Great Depression
  • World War II
  • The Korean War
  • The Vietnam War
  • The OPEC Oil Embargo
  • Stagflation
  • The Persian Gulf War
  • Sept. 11, 2001

Through it all, these companies could not be stopped from rewarding their owners. Over such a long time frame, a single, modest investment with dividends reinvested and compounded along the way would add up to a sizable nest egg. Make it a lifetime habit to own the best of the best dividend payers around, and you and your family can wind up quite well off, indeed.

This is the logic we use to invest at Motley Fool Income Investor. Strong companies that treat and pay their owners well make great long-term investments. Our market-beating results showcase just how well companies can perform when they focus on their long-term owners' needs. If you're ready to get serious about investing, join us today.

At the time of publication, Fool contributor Chuck Saletta owned shares of General Electric. He only wishes his great-great grandparents had owned some in 1899. Could you imagine what one share, bought back then, would be worth today, if all the dividends were reinvested along the way? Otter Tail is a Motley Fool Hidden Gems recommendation. Snap-on is an Income Investor pick. The Fool has a disclosure policy.