Thanks to their years of increasing dividends, I've always liked dividend stocks, especially those on the Dividend Kings and Aristocrats lists. The issue with those companies is that their dividend yield is often lower than I’d like. So, I sometimes look beyond my “go-to watchlist” for higher-yielding opportunities that pique my interest.
The thing is, a high yield can be dangerous. "Sometimes a company that has a very high dividend yield will at some point cut it as the drop in the stock price is likely the main reason for the high yield”, says Peter Boockvar, CIO at Bleakley Financial Group. Indeed, it’s not hard to find examples of companies that had a high dividend, only to have it cut later on.
