Are there any tips on how to pick the best dividend stocks?

You also would probably want companies that are paying dividends out by their normal operating activities, and not take on debt or have to sell its capital to simply fund dividend payout.

One way you can do this in through look at Free Cashflow to Equity (FCFE). Basically you would want their FCFE to be lesser than dividend payment and the cost to buy back shares, because that would show that the company is funding dividend payout or share buybacks by issuing more debt or existing capital or by issuing new securities. (https://www.investopedia.com/terms/f/freecashfl...)

Hi anon,

Regarding this, it would be encouraged to first understand the business model of the dividend stock, and how it sustains the high payout of dividends which it commits to. A consistent stable historical payout is a good indicator of commitment to the dividend payout schedule for the stock.

Cash flow growth and generation is also another good way of allowing you to pick stable healthy stocks. Yuo may have heard about the entire issue with Starhub and its high dividend payout amongst its high debt and low liquidity situation that has led to a selloff and dip in stock price, which essentially shows the importance of the long term stability and ability of the firm to fulfill and keep up with its dividend payouts.