Dividend-paying stocks provide shareholders the opportunity to create a passive income stream at a low cost. To identify the best dividend stocks, it's crucial for investors to focus on companies with predictable earnings, strong balance sheets, and a sustainable payout ratio - allowing them to pay, maintain, and even increase dividends across market cycles.
In 2023, dividend stocks lagged behind the broader markets, as higher interest rates and rising bond yields made alternative investments more attractive to investors seeking lower-risk, high-return assets. But with three potential interest-rate cuts on the table for 2024, dividend stocks are poised to make a comeback.
