Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

10 Most Important Metrics for Dividend Investors

By Matthew Frankel, CFP® - Oct 26, 2015 at 8:20AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Don't buy your next dividend stock until you know the right numbers to look at.

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 ( JNJ 1.38% ) and Wal-Mart ( WMT -2.48% ), to illustrate what they mean, and what they can tell you about a dividend stock's merits as an investment.

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

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Wal-Mart Stores, Inc. Stock Quote
Wal-Mart Stores, Inc.
WMT
$137.14 (-2.48%) $-3.49
Johnson & Johnson Stock Quote
Johnson & Johnson
JNJ
$158.08 (1.38%) $2.15

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
656%
 
S&P 500 Returns
144%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/01/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.