Earning Profits Through Dividend Paying Stocks in New Zealand

Report Prepared by Dividend Investor New Zealand

What are Dividend Paying Stocks?

In Simple Word's You can take this as whenever a company listed in Stock Market earns some profit it have two options first they can reinvest the profit money back into their business by buyin! their own shares back improvin! the business infrastructure setup buyin! some new resources etc" Second they can distribute some money out of their profit to their shareholders and this distributed amount which shareholder receives from the company are known as dividends" # $ompany can provide you dividend in two forms i"e" it can distribute the dividends in form of cash or it can !ive you stocks as dividend distribution" %owever there are different thou!hts on both as some people prefer to !et stock as dividend while many rest prefer to !et some cash re!ularly as dividends"

Why People Likes to

et Dividends?

When you buy a stock in stock market you e&pect somethin! to !et in return as you have invested your money on the stock" 'eople love to !et dividends because of the primary reason that dividends help you to build re!ular cash flow towards your stock portfolio" (enerally if you select a dividend payin! stock in New Zealand you will can !et dividends for that stock up)to * times in a !iven financial year because after every +uarter mostly companies review their profit and on the basis of profit they distribute the dividends to you" Now Ima!ine %ow will You feel if you will be paid * times in a year for a particular stock"

While !nvesting in Dividend Stocks?

#s you know there is one condition to !et dividend paid from stock listed companies and that is they should earn profits so that they can !ive some profit to you as dividend in New Zealand so all you need to do is identify some dividend payin! stocks which can possibly earn profit in ne&t +uarter half or year"

!dentifying the "est Dividend Paying Stocks in New Zealand

,here are few -ey Si!nals that reflects that how company has been performin! in the recent past and how much dividend it has been payin! to it's shareholders" We will discuss some important one in below" ,hese are as below.

Dividend Yield /arnin! 'er Share0/'S1 '2/ Dividend 'er Share Dividend 'ayout 3atio0D'31 Dividend (rowth 3ate Dividend %istory 'rice to /arnin! to (rowth 3atio0'/(1 45 week %i26ow Data

Why People Likes to

et Dividends?

When you buy a stock in stock market you e&pect somethin! to !et in return as you have invested your money on the stock" 'eople love to !et dividends because of the primary reason that dividends help you to build re!ular cash flow towards your stock portfolio" (enerally if you select a dividend payin! stock in New Zealand you will can !et dividends for that stock up)to * times in a !iven financial year because after every +uarter mostly companies review their profit and on the basis of profit they distribute the dividends to you" Now Ima!ine %ow will You feel if you will be paid * times in a year for a particular stock"

#$ Dividend %ield

Dividend Yield is a ratio which dictates how much a company pays out every year relative to it's share price" It is also known as the only return on investment in the absence of capital !ain" $alculated #s7
Annual Dividend Per Share Dividend Price Per Share

,his is a measure which tells you how much 8ban! for your buck you9 can !et from dividends" 6ets take an e&ample suppose there are two company # and : for which stock price are respectively 5;< and *;< and both are !ivin! same dividend <= per share to investor then dividend yield for # and : will be 4 and 5"4 respectively" So in such case it will make sense to invest in company # because it's havin! hi!h dividend yield and you will be makin! the same dividend which you will !et after investin! twice of this in :"

2. P/E & EPS

/arnin!s 'er Share is a financial ratio which shows how much earnin! company is havin! on each of it's share while '2/ basically works like an evaluation of a company's current stock price relative to it's earnin!s per share" $alculated as)
P/ E= EPS = Net Income Dividends on Preffered Stocks Average Outstanding Shares

Market Value Per Share Earning Per Share

/valuation of /'S and '2/ lets you know which stocks are ri!htly priced and helps you to find >nder priced or undervalued dividend payin! stocks in New Zealand Market"

3. Dividend Per Share, Payout Ratio, and Growth Rate

Dividend 'er Share shows the amount that you will be !ettin! as dividend on each of the stock while dividend payout ratio shows how much dividend company is payin! to shareholders out of it's earnin!s" Dividend per share should be as hi!h as possible while D'3 always should be less than =;;" #n ideal D'3 ran!es between ?4 to @;A" Do not consider dividend payin! stocks which are !ivin! you payout ratio of more than =;;A" Dividend (rowth 3ate is the annual !rowth rate by which dividends increase for a particular stock" If a company is performin! well in stock market it's dividend will be hi!hly increasin! as it will be makin! profit and will try to !ive shareholders each year more and more" Suppose # company is earnin! ;"B< on each share and is !ivin! you ;"*< thus havin! dividend payout ratio of =BB but there is risk as nobody can !ive you more than what it is earnin! at it's own"

4. Dividend History

Dividend %istory Shows since how lon! company has been !ivin! dividends to it's shareholders and it's +uite desirable while !oin! to buy hi!h Yield New Zealand dividend stocks that we choose stocks which are havin! lon! dividend history as a lon! dividend history simply means company is +uite stable and it has !iven easy dividends to shareholders in past" It adds an e&tra level of assurance and reliability"

5. ast !ut, "ertain#y $ot east

#lways check about the company profile market capitaliCation and 45 week %i26ow Data for havin! an better and more accurate analysis about a hi!h dividend payin! stock in New Zealand"

%ina# &ords''
If you will !o throu!h the mentioned steps every time while you buy New Zealand Stocks %i!h Dividend definitely you will be havin! a !ood bunch of best dividend payin! stocks from NZD" Eor More information on Dividend data for NewZealand Stocks You can visit us F nC"dividendinvestor"com