InvestorQ : Can you tell me about some front line stocks that have good dividend yield at the current market prices?
Rashi Mehra made post

Can you tell me about some front line stocks that have good dividend yield at the current market prices?

Answer
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Archita Jajjoo answered.
4 weeks ago


Dividend paying stocks can surely be defensive, safe and offer you a price support in tough times. Why rely on uncertain capital gains when you can rely on certain dividends. Dividend yield investing can be a good idea for more conservative investors.

When you select the best dividend paying companies, there are 3 things to focus on. First, the business should not be too cyclical. Secondly, the high dividend yield must not be due to low prices. Lastly, the dividend must have been sustained over 4-5 years to be reliable.

Some of the companies with good dividend yield can be summarized as under. The dividend yield ratio is captured in brackets. These include ITC (5.20%), Hindustan Zinc (7.02%), Power Grid (5.41%), IOCL (10.46%), Petronet LNG (5.08%), Pfizer (6.80%), Sun TV (5.16%).

Not all companies paying high dividends may have healthy profit and loss account and balance sheet. Ideally, you should ensure that the company generates adequate cash flows as these are the kinds of cash cows that can sustain dividends over time.