Stock market rally: is it too late to buy and hold cheap dividend stocks?

first_img I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Our 6 ‘Best Buys Now’ Shares Stock market rally: is it too late to buy and hold cheap dividend stocks? Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. Simply click below to discover how you can take advantage of this. Are you on the lookout for UK growth stocks?If so, get this FREE no-strings report now.While it’s available: you’ll discover what we think is a top growth stock for the decade ahead.And the performance of this company really is stunning.In 2019, it returned £150million to shareholders through buybacks and dividends.We believe its financial position is about as solid as anything we’ve seen.Since 2016, annual revenues increased 31%In March 2020, one of its senior directors LOADED UP on 25,000 shares – a position worth £90,259Operating cash flow is up 47%. (Even its operating margins are rising every year!)Quite simply, we believe it’s a fantastic Foolish growth pick.What’s more, it deserves your attention today.So please don’t wait another moment. Image source: Getty Images. Peter Stephens | Tuesday, 2nd March, 2021 FREE REPORT: Why this £5 stock could be set to surge Get the full details on this £5 stock now – while your report is free. Enter Your Email Address The rally following the 2020 stock market crash has allowed many shares to trade at significantly higher prices. Despite this, it’s still possible to purchase cheap dividend stocks in order to obtain a generous passive income and the potential for capital growth.Through focusing on their quality and future prospects, an investor can realistically build an attractive portfolio of income shares. On a relative basis, it could deliver high returns in a low interest rate environment.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Cheap dividend stocks may still be availableWhile the recent stock market rally has pushed many share valuations to higher levels, some sectors remain modestly valued by comparison. Within them it may be possible to buy cheap dividend stocks. Certainly since bullish investors may have turned their attention to other industries that apparently offer higher growth rates at present.For example, a number of strong businesses in the retail and consumer goods sectors appear to have bright long-term outlooks. Moreover, they seem to have the financial means to overcome future risks from a challenging economic outlook to produce a rising dividend payout for investors. Due to weak investor sentiment at the present time, they could offer the potential to generate impressive total returns in the coming years.Focusing on the quality of income sharesOf course, not every cheap dividend stock could be worth buying. The world economy has experienced one of its biggest ever shocks in recent months. As such, high dividends from previous years may fail to be paid in future. Similarly, some companies may struggle to survive difficult operating conditions. Especially if they have large debts or weak cash flow.Therefore, it’s important to check the quality of any stock before buying it. This can mean taking steps such as reading its latest investor updates, assessing its strategy, and analysing recent annual reports. Doing so allows an investor to build a strong picture of the company in question so they avoid potentially unattractive investments.Moreover, they may be able to find the strongest businesses that trade at the lowest prices. They could prove to be the most appealing cheap dividend stocks to buy at the present time.Considering the relative appeal of dividend sharesCheap dividend stocks may be less prevalent than they were several months ago due to the stock market rally. However, their relative appeal appears to be high. The world is currently operating in a low interest rate environment that could persist for a number of months, or even years.Therefore, relying on other income-producing assets to generate a passive income may prove to be a disappointing move. By contrast, the return potential from dividend shares that trade at low prices could be highly attractive from a long-term standpoint. See all posts by Peter Stephenslast_img

0 thoughts on “Stock market rally: is it too late to buy and hold cheap dividend stocks?”

Leave a Reply

Your email address will not be published. Required fields are marked *