Dividend investing is a spectacular way of accumulating wealth, especially if you locate your dividend stocks in tax-efficient accounts. In fact, I’d argue that nimble dividend investing would beat capital gains investing in today’s economy.
Despite the allure of dividend investing, risks are ever-present. For example, many companies sustain their dividend payouts to satisfy investors while depleting their book values and, in turn, their stock’s fair value. Another risk worth considering is that some companies pay dividends instead of reinvesting in their businesses, consequently driving down their future growth prospects.
This article focuses on three dividend-boosting stocks that face price risk due to the aforementioned reasons. Let’s discuss each in depth.
This post appeared first on InvestorPlace.