Though dividends are not the only yardsticks by which you measure the performance of a particular stock, they play an important role in influencing your investing decision. Not all dividend stocks are equipped with the capacity to sustain in the tough market conditions of the coming years. There are only a few stocks that not only make their investors happy with reasonable payouts but also have it in them to grow at a phenomenal rate in the future. If you invest in these stocks, you are sure to see your money multiplying to great extents in the future. Let us see a couple of dividend stocks for whom the future is quite bright and nice as of now.
Massive dividends and impressive financials
Boeing Airlines (BA, Financial) is the one of the most promising dividend stocks that is staring at a great future because of lots of factors. In the last 10 years, the management of Boeing has increased dividends by a whopping 190%. During December 2014, the company again increased its dividends, which stood at around 88% higher than the amounts paid out during 2012. In addition to that, Boeing was also involved in share repurchases worth an impressive $12 billion. All of these are enough reasons to invest in the stock as shareholders’ worth is given first priority here. The following shows Boeing’s quarterly dividend payouts over the years. Look at the pace of increase; why would investors not love this?
If you thought that Boeing becomes a promising stock only because of its dividends, you are wrong. The company’s financials have been excellent and look great for many more years to come. This is because, it has increased its production capacity at a steady pace and today it is expected to produce 44 and 12 units of its 737 and 787 commercial aircrafts respectively by 2016. In addition to this, Boeing is sitting pretty with its backlog orders is currently worth a mammoth $502 billion, thereby giving investors the assurance that it has a bright and secured future to look forward to.
Rising strongly after historic recalls
If there is one company that can come back strongly after a disastrous product recall phase, it has got to be a company that has strong business values and the passion to succeed. We are going to see one such stock here – the automobile giant, General Motors (GM, Financial). During 2014, the company had to recall 27 of its vehicles from the U.S. market; the largest for any automobile company. A lesser company would have surrendered meekly to the pressure. Not General Motors, of course! The company came back very strongly the same year and posted some impressive numbers in its SUV (sports utility vehicle) segments and truck sales. Truck pickup sales and SUV sales values for February 2015 were higher by 37% and 66%, respectively, than the sales figures of February 2014. The top-level think tank of General Motors has already planned out some strategic cost-cutting initiatives that could help the company in huge savings. As a starting point, the company plans to cut down its international production units from the current number of 26 to just about 4. This will help centralization of operations and will bring about savings of hundreds of thousands of dollars to the company. Its sedan, Chevy Impala, became the first American-made sedan to be awarded the top rank in Consumer Reports in about 20 years.
Also, the company is planning to focus exclusively towards setting up its operations in one of the most promising economies of the globe today – China. GM is planning to invest close to $14 billion in the Chinese economy and produce close to 5.4 million vehicles in the country by 2018 – the year by which the company aims to introduce 60 (new and used) vehicles into the market. In the Chinese market, GM plans to increase its market presence to a large extent, by setting up five vehicle production units and two centers for power training. All these factors make General Motors a very strong stock for the future. This coupled with the current dividend yield of 3.2% makes GM the darling of investors. Historical dividends of GM can be seen from the chart below:
The dividend stocks discussed above have immense potential for the future and hence are sure to provide investors very good returns. When investors get handsome quarterly returns, they can pool back the same into the market for reinvesting purposes. This will give them a chance to compound their returns. Getting back returns can be possible from dividend stocks; but if you want to multiply your money and get the full benefit from it, these dividend stocks with a bright future are the only choices for you. Invest in these and watch your money grow like never before!
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