This preview shows page 1. Sign up to view the full content.
Unformatted text preview: n translate into low expected growth rates in
In summary, a strategy of buying high dividend stocks historically has made the
most sense for investors with low tax rates or for investments that are tax exempt, like
pension funds. With the changes in the tax law, more investors may find this strategy to be
attractive. If you adopt such a strategy, you should screen high dividend paying stocks for
sustainability (by looking at dividend payout ratios and free cashflows to equity) and
reasonable earnings growth. 42 Appendix: Firms that pass the dividend screens – October 2002
Stocks with dividend yields>4%, dividend payout ratios < 60%, dividends < FCFE and expected EPS growth > 4%
Alexander & Baldwin
Banco Santander ADR
Bay St Bancorp
Colonial BncGrp. 'A'
Electronic Data Sys.
Equity Inns Inc.
View Full Document
This note was uploaded on 01/17/2012 for the course ECON 101 taught by Professor Econnorm during the Spring '11 term at Art Institutes Intl. Minnesota.
- Spring '11