Traditionally, utilities, banks, and some blue-chip manufacturing firms have been regarded as having a good stock dividend yield. These companies are more stable and are less likely to experience negative dividend growth, which becomes an important consideration when dividend stock yields make up a sizeable portion of a retiree’s monthly income.
In general, larger, older, and more stable companies offer better rewards in the form of high dividend paying stocks because they make more money, which means their stockholders also make more money. It’s a good idea to read the companies’ annual reports, especially the pages containing data on their dividend payments for the past five or ten years. This information illustrates the companies’ commitment to paying dividends, not treating them as an occasional luxury splurge on their stockholders.