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3 Stocks To Buy For Long-Term Dividends And Buybacks

Income investors often search for stocks for long-term dividends and buybacks to round out their portfolios. The obvious starting point to locate these types of investments is by looking at yield. This tells you the percentage of that company’s share price paid out in dividends.

There are a few ways to work out whether a company’s got the financial fortitude to continue paying and expanding its dividend. The first is to look at the payout ratio, which compares a company’s dividend payouts with its net income. Investors can also look at cash flow compared to dividend payouts to understand how difficult it is for a particular company to cover or increase its dividend payments.

Finally, income investors may want to consider the top stocks for dividends and buybacks. Both dividends and buybacks are ways that companies return cash to shareholders. The latter offers a bit more flexibility. Whereas companies have to cut their dividend if times are tight, buyback programs offer a way to return excess cash to shareholders on a one-off basis.

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