#high-yield-dividends

#high-yield-dividends

Interest rate cuts make high-yield dividend stocks more attractive because they reduce competition from fixed-income investments while lowering the companies' borrowing costs, which can support both dividend sustainability and stock price appreciation. At 24/7 Wall St., we attempt to evaluate the underlying business fundamentals and dividend sustainability before recommending companies to our readers. Often, remarkably high yields can sometimes indicate financial stress rather than opportunity, as was the case with Walgreens this year.

Reliable high-yielders are your best friends today, and they will likely remain that way for the coming years. That's especially true if they operate as midstream or as a utility. They have a rare combination of defense and growth that no other sector can match. Demand for electricity, gas, and water does not flutter when the headlines turn grim, so cash flow stays predictable and dividends stay funded.

As investors, we love dividend stocks, especially the ones that have high yields since they provide a steady source of income and improve the total return potential. The total return for any investment includes dividends, interest and capital gains. So as we step into September with the hope of the Federal Reserve enacting an interest rate cut, it is time to focus on the high-yield dividend stocks that can generate more passive income for you since fixed income will be less appealing in a lower rate environment.

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