How Telecom sector may provide solid dividend growth potential
One of my investing strategies
is to diversify across several sectors of the stock market. Among all sectors,
I think Telecom sector is going to be thriving in coming years. Whatever we do these
days, seems like all somehow depends on consuming more and more data and internet
time. Also assuming, with time, most of the jobs will be remote in nature, so
people will need ever increasing access to internet.
With the advent of 5G,
personal and business data consumption will be a big source for telecom giants
like AT&T, Verizon, Comcast etc. Although developing infrastructure for
telecom companies is capital intensive but a steady revenue somehow seems like
offset that burden. I don’t think this sector went slump like energy sector in past
many years.
My personal investing strategy
is geared towards more on dividend growth side. I have many growths only stocks
in my portfolio but try to keep them no more than 25 percent. One of the characteristics
of large telecom stock is to reward stockholders with solid year after year dividends.
Although the stock price growth of these stocks is not stellar like Amazon or
Netflix but reinvested dividend often may compensate for that.
Recently, I did some research to find good telecom stocks from US and Canada.
I find Canadian stock market quite stable but often ignored by investors for
States. Here is the list I added to my portfolio in this month:
Here is the dividend yield I
got at the time of the purchase which I thinks is sweet!
In addition to high dividend
yield, most of these stocks also saw significant appreciation of price in
the last 10 years. So, although I am categorizing them as high dividend earners,
but they are somewhat growth stock as well. To me that’s the best of both world!
Usually I like to invest in stocks with P/E ratio of 16 or below. This gives me an approximate idea
that I am not buying something overvalued, specially considering the long bull
run we had in last 10 or so years. At the time of my purchase all of them we
below 16 which I think is a fair valuation.
In this year, I am planning to
add more of these telecom stocks in my portfolio. I may also do some research
to see if there are good telecom stocks to buy from Europe or Japan.
That’s all for today! Thanks.
Disclaimer: This article shows my personal
opinion and its for entertainment purpose only. This is no way professional financial
advice. You may seek professional advice or conduct own research before
investing.
Image Courtesy: Karolina Grabowska from Pixabay
Comments
Post a Comment