In the latest episode of the 24-7 Wall Street Finance Series, financial analyst Jeremy Phillips discusses high-yielding Dividend Kings, with a focus on Altria, which has an impressive dividend yield of 9.4%.
Phillips explains that Dividend Kings are stocks that have not only maintained but also increased their dividends annually for over 50 years. This credential highlights their appeal to investors seeking reliable and growing income streams, especially in the face of inflation. He details the dividend yield as a ratio indicating the annual payout relative to the stock price, stressing the importance of assessing the sustainability of these dividends.
Specifically for Altria, despite its high payout ratio of 83%, which suggests a strong commitment to shareholder returns, there are concerns about its long-term sustainability due to the heavily regulated nature of its industry and declining trends in smoking. Phillips ultimately expresses caution, highlighting the necessity to consider both the current yield and future viability of such high dividend payouts.
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