The other day someone was bragging about the dividend payment they received for one of their investments. They had no idea that the company was actually making less profit than they were paying out in a dividend annually. This got me thinking, what does a dividend actually tell you about an investment? Better yet, what does a company want you to think about them when they decide to offer a dividend?
Running time: 6:28
In this episode:
- Why would someone look for an investment that offers a dividend?
- Why would a company pay a higher dividend than what they’re making in profit?
- Warren Buffett doesn’t pay a dividend
- When do companies usually offer a dividend?