The purpose of investing in “dividend stocks on sale” is to collect dividends. Therefore, the focus of this process is overwhelmingly geared toward that goal, and not toward future stock price appreciation. This isn’t an attempt to find price bottoms. It’s a process to buy dividends at a reasonable price. As a result, the stocks presented here are typically on a downward trend. And, they will often continue on that downward path over a period of months, providing opportunities to obtain additional dividends for collecting and reinvesting as they do. Simply put, it’s about creating as many future dividends as possible.
Stock data from Yahoo Finance and Stockcharts.com
Stocks must pass these criteria to be considered:
- Forward dividend yield >=3.5%
- Consecutive calendar year dividend increases >= 10 years; or a 7 year dividend growth rate >= 2% (historical average inflation rate)
- Monthly close < 60 month simple moving average
- Relative strength index (14 month) < 50
- Monthly closing price < mid point of the 52 week monthly high and low prices
Stocks considered “On Sale” if one of the following criteria is met.
- Forward dividend yield >=5%
- Lowest monthly close in 1 year or more
- Monthly close >=15% below 60 month simple moving average
- Relative strength index (14month) <= 35
- Correction from the highest monthly close in the last 5 years >= 40%
(The report is in PDF format. If the report doesn’t open in a new window or tab, check your download folder for the file.)