Dividend growth is a parameter to measure the ability of a company to share its profits with the shareholders. Companies providing a consistent dividend growth rate tend to be valued both higher and as more a stable investment alternative. Also dividend growth is a parameter used in some stock valuation models (i.e. dividend discount model).
Generally speaking, a high dividend growth rate justifies a higher intrinsic value for the stock. Selecting stocks with a relatively high and stable dividend growth rate tends to be best for investors looking for stable income and lower volatility.
Homepages -
Dogs of the Dow Glossary -
Dogs of the Dow -
Investor Glossary # A B C D E F G H I J K L M N O P Q R S T U V W X Y ZRelated Terms -
Dividend -
Dividend Yield
