Following is a guest post from Devin, blogger at Dividend Chimp.
Devin A. Decker, Esq.
Bio: Devin is an Estate Planning Attorney and Dividend Growth Investor. He has been helping individuals plan for retirement since 2002. Devin writes about his options trades and provides dividend stock research services at his website: DividendChimp.com
My Approach to Dividend Investing:
I work from the most static to the most dynamic information, this means I start with relatively stable data and move onto information that changes more frequently. I’ve found this to be the most efficient way to track stocks.
Stock prices are in constant flux, this means that Dividend Yield, Price to Earnings Ratios (P/E), Price to Earnings Growth (PEG), and Price to Earning Growth plus Dividend Yield (PEGY) are constantly changing with the stock price.
It may be tempting to jump straight to yield and quickly discard a stock that doesn’t meet your minimum dividend yield criteria. However, you could miss a great company that raises its dividend 50% next quarter because it wasn’t on your watch list.
On the flip side, don’t too get excited about a high yield stock without checking its dividend history first, you may see the dividend goes up and down from quarter to quarter with no stability.
I prefer to start with data that changes yearly, then the data that changes quarterly, and lastly the data that changes daily (sometimes by the minute).