5 Dividend Monsters To Avoid

More and more investors have been drawn to dividend stocks after the financial crisis of 2008, as they seek the comfort of a regular cash income, and at the same time, the prospect of capital appreciation on these investments. Yet, investors often make the mistake of looking solely at the dividend yield when deciding on buying a stock. By ignoring other factors that may lurk behind the façade of a high dividend, investors may still burn their fingers on a stock, which they thought was 'safe' simply because it offered a good yield. These factors include changes in company's underlying business, improper cash management, and sudden equity dilutions. In this article, we look at five high-yielding dividend monsters (we call them 'monsters' if the yield is in excess of 5%) that are best avoided. Chimera Investment Corporation (CIM): Price $2.37, Dividend yield 18.6% Chimera Investment Corporation invests in residential mortgage-backed... Read more