UBS strategist Keith Parker says that dividend-paying stocks tend to outperform the market during tough times.
Parker recommends investing in stocks that pay good dividends and have the ability to repeatedly increase those payments.
He’s compiled a list of high-dividend stocks that promise sustainable dividend growth through 2025.
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As the economy slows and stocks react to the turmoil in the banking system, investors have been looking for safer and less volatile ways to invest their money. Dividend stocks have proven to be a popular choice.
Few experts would advise investors to buy the biggest dividend payers and leave it at that. This tip is too simple and probably too risky. Just because a stock pays a big dividend today doesn’t mean it always will. And it’s not a guarantee of price gains either.
Pundits and strategists advise investors to look for companies with strong free cash flow and a history of dividend growth, as these companies are more likely to maintain their dividends and increase them over time.
30 high-dividend stocks that have the potential to go up
Keith Parker, chief strategist for US equities at UBS, recommended a version of this approach in a recent client note.