TOP 3 DIVIDEND STOCKS TO CONSIDER INVESTING IN NOW! 🤑 #Best Education Page #Online Earning

what's going on you guys I hope you were

having a fantastic day today we're going

to be talking about the best dividend

stocks for 2018 now some of you may be

noticing that I'm using a whiteboard

here and those of you that have been

following my channel for a long time

know that I used to have my old

whiteboard set up it's actually still

back here behind my black backdrop but

for the issue of trying to light the

board I had a very hard time with that

but I'm gonna use this whiteboard

probably for most of my videos going

forward because I still have a lot of

markers and it's not wasting all that

paper with the other pads of paper that

I use but if for whatever reason you

guys have an issue with this and you

prefer the pad and paper let me know in

the comments I'm totally fine with doing

either one of those two things but we're

gonna cover the top three dividend picks

I have for 2018 and now I also want to

thank you guys those of you that have

joined my new stock analysis membership

site stock radar my goal was to get 100

members in there by the end of this

month and we've already reached 106 so

that is absolutely amazing you guys can

get into that group right now the actual

sale for that ends on Thursday at 11:55

p.m. Eastern Standard Time and I have a

big reason that you guys should join

right now that might interest you is I

just added an entire course to this

group on fundamental stock analysis it's

a ten part course talking all about how

to value a company's stock and how to

conduct fundamental analysis of a

company and I'm also going to be adding

an entire course on bare market

investing strategies and I'm going to be

bringing on an expert in technical stock

analysis and maybe down the road

somebody who is an expert in options I'm

gonna be having all kinds of extra bonus

material and courses within this you

guys are not gonna want to miss out on

that now the price of this membership is

going to increase with time so if this

does interest you you might want to get

in while it's cheap but because we're

talking about dividend stocks today I

want to give you guys a free preview of

that new course on fundamental stock

analysis 101 so this is going to give us

a good background on how to analyze

dividend stocks and we're going to be

talking about the dividend coverage

ratio of these stocks so I just want you

guys to have a little bit of background

information on that so here is a preview

of fundamental stock analysis 101 a free

course available to you in stock radar

how's it going today guys welcome back

to fundamental stock analysis 101 and in

this video we're going to be talking

about the dividend now I want to start

out by pointing out the typical growth

rate of a company and it looks very

similar to this curve

here so when a company starts out and

when they're a new company they're going

to grow at a much faster rate than

they're going to grow in the future and

as a result you're going to see that

growth begin to taper off going forward

so this is what companies do when

they're in this zone here when they're

growing at a much slower rate or they're

just consistent with their operations

what they do is they pay dividends as a

way to reward shareholders and keep them

around now dividends are quarterly cash

payments and they're sharing their

earnings with the shareholders so if

they're earning a lot of money they have

a lot of earnings per share they might

make the decision to pay shareholders a

quarterly dividend now we talked about

the dividend quite a bit here in stock

radar we talked about the dividend

history how long this company has been

paying that dividend the dividend growth

streak so how many years has that

dividend been growing and we also talked

about the dividend yield or how much

they are paying to shareholders so just

understand that when a company is an

income mode when a lot of the growth has

already happened and they're growing at

a much slower rate or they just have

consistent or flat growth they're going

to become an income investment because

they are likely going to reward

shareholders with dividends but a

company that is in growth mode if

they're trying to grow as fast as

possible they're not going to pay

dividends they're going to be

reinvesting those earnings into the

growth of the company so we used AT&T as

an example of an income investment they

pay dividends to shareholders because

they are not growing very fast and

Amazon is a growth stock because they

are reinvesting all the earnings to grow

the company as fast as possible and as a

result they don't pay a dividend so

Amazon is still down here on this curve

where they're growing very rapidly while

AT&T is further along in this curve

where they're pretty much flat with very

little growth going on and as a result

AT&T is paying dividends to reward

shareholders and give them a reason to

stick around because if you guys saw

that video here on stock radar the stock

has had very lackluster performance and

there's not much there being offered

other than that very high dividend so

how do you actually calculate the

dividend the company pays what you do is

you take the annual dividends paid out

divided by the market price and that's

going to give you the dividend yield and

again all you have to do is do a search

for a stock on Google and it's going to

show you the dividend yield right on

that chart but that's how you go about

calculating it so let's calculate the

dividend yield for AT&T over the last

four quarters they've paid a forty nine

cent dividend so we take 49 cents times

four

and divide it by the market price up

3716 and that gives us a dividend yield

of 5.3 percent so what kind of dividend

yield should you be looking for as an

investor if you're looking for an income

investment well the S&P 500 average

dividend is around 2.2 percent but if

you're looking for an income investment

and you're not focused on growth a good

number to look for is between 3 to 6 so

18 T falls in there they have a 5.3 a

very good dividend but they have no

growth potential pretty much I mean the

growth has been non-existent over the

last five years so that's the issue that

you have there you have to weigh the

pros and cons are you looking for a high

dividend with low growth or no dividend

with higher growth that's what you have

to decide as an investor is what you are

looking for now another very important

thing to consider is whether or not a

company can afford to pay a dividend

because high dividends are great but

understand that dividends are not

guaranteed and they can cut or

discontinue a dividend at any time a

perfect example of this is General

Electric they had to slash that dividend

because they simply could not afford to

pay that dividend and they still can't

afford to pay the dividend even now so

the future for them is uncertain they

may have to cut the dividend again but

anyways the way you calculate that is by

looking at the dividend coverage ratio

and this is very simple to figure out

and this might be something you have to

calculate on your own because I have yet

to find a resource that does this for

you but all you do is you take the

annual earnings per share and divide it

by the annual dividend per share and

that gives you an idea of how much of

the earnings they are passing along to

shareholders and how much of the

earnings they are keeping for themselves

so basically let's go ahead and

calculate this for AT&T looking at the

fiscal 2017 year numbers so for fiscal

year 2017 AT&T had earnings of $4 and 76

cents and they paid out $1 in 97 cents

of dividends giving them a dividend

coverage ratio of 2.4 so what exactly

does that mean here's what it means if

the dividend coverage ratio is below 1

that means they are paying out more in

dividends than they are earning that was

the case with General Electric and as a

result that is very bad that means they

are likely going to have to restructure

or cut that dividend now if the dividend

coverage ratio is between a 1 to a 1.5

they don't have great coverage of that

dividend and they will likely be cutting

it or restructuring it in the future the

optimal zone to be

is between a-two and a-three and as we

can see AT&T came in at a 2.4 so they're

right where they need to be so when

you're looking for a dividend coverage

ratio I always look for a dividend

coverage ratio between two and three but

on the other side of the coin if the

dividend coverage ratio is above three

that means the company is retaining most

of those earnings and they may be being

greedy so what I look for is a dividend

coverage ratio between two and three if

it's below a 1.5 I don't think that is

investment worthy and if it's above 3

then you want to make sure that company

is reinvesting earnings and not just

retaining them for themselves anyways

guys that's going to wrap up this video

just for a recap here we talked about

how companies typically grow faster at

the inception and grow at a slower rate

going forward and how income investments

pay dividends while growth investments

what they are doing is reinvesting the

earnings into the growth of the company

we talked about how to calculate the

dividend yield we looked at the average

rate of the S&P 500 and said a good

dividend to look forward between 3 and 6

percent and then we talked about the

importance of the dividend coverage

ratio and why you need to make sure a

company can afford to pay the dividend

they are paying to shareholders and we

talked about those numbers right here

and the optimal range for what I look

for is between a 2 and a 3 but that's

all I got for this video and I hope to

see you in the next one ok guys so I

hope you enjoyed that free preview of

fundamental stock analysis 101 the other

9 parts are sitting there waiting for

you right in stock radar if you're

interested but now that we have some

background on what we're looking for

with dividend investments I want to go

ahead and talk about my top three picks

for 2018 now I actually started with a

list of about 15 high dividend stocks

and what I went through is I went

through and looked at that dividend

coverage ratio which we just learned

about and that is something that is very

important and a lot of people don't

consider this is whether or not a

company can actually afford to pay a

dividend of course high dividends are

great and we all want to invest in high

dividend investments but the number one

question you should ask is can this

company actually afford to pay you so in

my opinion all three of these companies

have a very safe dividend and they all

have a good ability to pay that dividend

to shareholders and the thing about

dividend investments is if you're

looking for a pure income investment it

should be very boring and these are

three of the most boring companies that

you can think of it's AT&T its Pfizer

and then it is Kimberly Clark and I have

very high confidence in these three

dividend stock

as far as their consistency and their

ability to pay that dividend to

shareholders so number one on my list

here is AT&T it's a stock we've already

covered over in stock trade arm they

have a dividend of five point four

percent and they have a dividend

coverage ratio of two point four like I

said above one point five is acceptable

but I'm looking for a dividend coverage

ratio between two and three now as far

as that dividend goes they've been

paying that dividend to shareholders for

34 years and they have a thirty four

year growth streak of that dividend AT&T

is the world's largest

telecommunications company they have a

very favorable business model for income

investors because it is

subscription-based whether it's through

their data subscriptions for their cell

phones or the internet plans they offer

or maybe it's through the direct tv

subscriptions because 18t does own

Direct TV that subscription business

model is very consistent and predictable

and so it's great for an income

investment it gives AT&T a lot of free

cash flow now there is one downside to

this investment is that at this point in

time AT&T is solely an income investment

over the last five years this stock has

returned just four percent to

shareholders so there's absolutely no

growth with that stock over the last

five years all they are really offering

is that hefty dividend of five point

four percent but that being said I would

say AT&T has one of these safest

dividends out there due to that

subscription-based business model and

their amazing track record of paying and

growing dividends now number two on my

list is going to be Pfizer they have a

dividend of 3.7 percent their dividend

coverage ratio is actually better than

AT&T S at a 2.7 and they have been

paying dividends for 38 years they had

to cut them back in 2009 but since 2009

they've grown that dividend every single

year so they have a nine year dividend

growth streak the reason why I like

Pfizer as an income investment is

because this is a recession-proof

industry this is a pharmaceutical

company they're making pharmaceutical

drugs that are saving people's lives or

we're keeping them alive and so no

matter what these people are going to be

buying these drugs whether or not they

are in a good economy or a bad economy

so we could argue that maybe in a bad

economy people are not going to be

spending as much money on travel and

dining but they are sure as hell are

going to be paying their money to Pfizer

in the form of their prescription drugs

people are going to buy the drugs no

matter what the economy is doing and for

a good reliable income investment that

is what you want to see you want to see

a recession-proof in

this tree and the other thing that is

great about Pfizer is there is very high

research and development costs

associated with pharmaceutical drugs

which gives them very high barriers to

entry the other plus for Pfizer is the

fact that they have had pretty decent

growth over the last five years there

are thirty four point four percent over

the last five years and that is why they

are my number to pick here as far as

dividend investments for 2018 and number

three on my list is Kimberly Clark they

pay a dividend of 3.5% and their

dividend coverage ratio is 1.6 percent

now like I said I like to see one

between two and three but as long as

it's above 1.5 that usually means that

company can afford to pay that dividend

and they will likely not be

restructuring it now Kimberly Clark has

been paying a dividend for 46 years and

they have grown that dividend in all of

those years they have the longest

dividend history and longest dividend

growth streak of any of these pics right

here and the reason why I like Kimberly

Clark is because they are in the

consumer staples industry they are

producing everyday essentials things we

are using every single day no matter

what and a lot of people don't realize

what brands Kimberly Clark owns and I'm

gonna tell you guys what those are right

now so the main brands under Kimberly

Clark are Kotex you have Kleenex you

have cotton Elle you have Huggies and

you also have depend and then on top of

that you can add Scott there's the Scott

paper towels and the Scott toilet paper

there's all kinds of paper products and

all kinds of these household names that

Kimberly Clark owns so Kimberly Clark is

one of the largest manufacturers of

paper and hygiene products we're using

these things every single day I'm gonna

take a guess that even if you didn't

have the money you're still gonna buy

paper towels and napkins and toilet

paper and other products like that I

mean these are things we need no matter

what that is what I like about Kimberly

Clark and that is why I see this as a

very safe dividend investment so over

the last five years Kimberly Clark has

returned twenty four point nine percent

and the other plus for Kimberly Clark is

the fact that they have global exposure

they do about half of their sales in

North America and the other half are

international so they're diversified

across different markets this just makes

them a very very safe and consistent

investment and that is why they belong

here on my top three dividend picks for

2018 anyways guys that is all I got for

this video let me know what you guys

think of these picks in the comments

section below

and what dividend stocks are you

investing in do you have any of the

picks listed here or do you have diff

one's entirely but again guys just keep

in mind I do have that ten part course

on fundamental stock analysis waiting

for you right now over in stock radar if

you guys want to join that discount ends

Thursday at 11:55 p.m. Eastern Standard

Time and that membership price is going

to go up for good but I thank you guys

for taking the time to watch this video

and I hope you have a great rest of your

day if you are interested in learning

more about investing in the stock market

I've created a free course just for you

the link is in the description below

here are a few other videos you might

enjoy as well

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