Well, our portfolio has a nice mixture of dividend paying stocks and some (APPL included) that does not pay a dividend. We bought APPL for the growth potential. However, no matter how you look at it, the growth in the stock value does NOT include our wealth UNTIL we sell - period. So for a long-term investment a dividend paying stock is the way to go. If one choses to invest in a non-dividend paying stock then one must be prepared to sell in order to take advantage of the growth in the stock.
As I see it, the analyst is correct. If APPL wants to keep long-term investors then they need to pay dividends. Otherwise, the stock just becomes a vehicle for traders who buy/sell at every turn of the stock. This does not provide the stability long-term investors want or need nor does it provide the stability a company needs. Right now investors are having fun riding the wave but that will eventually stop and most of us will sell hoping to get off the ride at the top. When that happens the the stock will plunge. Especially as the hedge funds try to make their numbers and are forced to take profits where they can.
While I love growth in my stocks, dividends are what drive me to retain a stock. Otherwise it's just a trade.
Dividends are the best way for a company to retain the long-term investors and every company needs long-term investors to keep the stock price stable - even the golden APPL.
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