What Makes a Stock a Best Dividend Stocks constituent?
This screen identifies high-quality dividend payers by filtering for a market cap over $1B and a yield exceeding 2%, ensuring you avoid volatile micro-caps. By requiring a positive 1-year total return, we filter out yield traps like AT&T in 2021, where the dividend yield looked attractive while the stock price plummeted.
Filter for Institutional Scale
We set a $1B market cap floor to avoid liquidity risks. For example, smaller firms like many regional banks in 2023 often cut dividends abruptly when liquidity dried up.
Screen for Meaningful Income
A 2% yield threshold filters out growth stocks like Nvidia, which prioritizes reinvestment over payouts, focusing your search on established cash-flow machines like Coca-Cola.
Validate Price Stability
Requiring a positive 1-year return prevents buying 'yield traps'. For instance, Lumen Technologies had a massive yield in 2022, but the stock price fell 60%.