High Vs Low Dividends

sh856531

Hi All,

I've been reading a bit about the various dividends paid by various companies. It seems as though the range of dividends ranges from 0 up to 16%+

I was wondering what the relative merits of a high dividend company vs a low dividend company is? Why would I choose a company paying 2% when I could chose a company paying 7% or higher?

Do companies paying a lower dividend tend to have more stock price growth or is it not that simple?

Many thanks all

Simon

Lokolo

Don't forget you should look at share price.

If a company gives out a dividend of 15% but their share prices have lowered 50%. Then another company gives out a dividend of 2% but share prices have risen 10%.

Which would you chose?

Depending on the company a lot of them give out high dividends because performances have been weak or share prices has fallen, so if they want to stop shareholders selling (thus lowering the price even more) they have to keep them happy somehow.

clairbear_3

The concern with the higher yielding share is how sustainable it is
It may appear very attractive enticing you to buy the shares but theres no guarantee it wont be reduced/scrapped altogether
Remember also the shareprice usually falls by the dividend % after ex div date so if u r 'targetting' divs get in early