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Shift To Value And Supercharge Your Income: 5 Overvalued Dividend Stocks Vs. 5 High-Quality Alternatives

Published Tue, 08 Sep 2020 14:27:58 -0400 on Seeking Alpha

Seeking AlphaDividend StrategyShift To Value And Supercharge Your Income: 5 Overvalued Dividend Stocks Vs. 5 High-Quality AlternativesSep. 8, 2020 2:27 PM ET|| Includes: CHD, CLX, FLO, HD, IBM, LRCX, MKC, MMM, PEP, PM, UPSby: Robert & Sam KovacsRobert & Sam Kovacs Long Only, Dividend Investing, Dividend Growth InvestingSummaryWith markets correcting last week, many investors are looking to shift to value.
I argue that you should always be looking to prune your portfolio.
When stocks become overvalued, shifting to value can supercharge your income and reduce downside risk.
Written by Sam Kovacs
Two consecutive days down just before labor day weekend. Not the news most investors wanted to hear. Is this the early stages of prolonged pain, or is it a mere correction which will correct itself in days to come.
In a recent article which resonated with many fellow investors, “Calm Down: This Time Won’t Be Different,” I reasoned that it didn’t matter if the market would go up or down over the course of a few months or even a couple years.
What does matter, is that you have a strategy which enables you to meet your retirement goals.
Source: Open Domain
Nobody is investing for fun. Sure, I enjoy the intellectual challenge, but that’s not the reason I do it. I do it because I plan my stock market investments to allow me to retire comfortably. You probably feel the same.
Robert and I have been suggesting a dividend first approach, whereby you invest in stocks whose dividend policies alone will allow you to retire on dividends. This is explained in detail in our article “How you can retire on dividends forever and ever.”
The simple idea is that you need a certain combination of dividend yield and future dividend growth to meet your goals.
Depending on your investable assets, monthly contributions, time to retirement, and estimated retirement spending, you will come up with a table that would look like... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
PHILIP MORRIS INTERNATIONAL 74.90   14.9 5.03 4.68 6.12
IBM 143.62   14.8 9.68 6.48 4.47
3M 170.58   20.6 8.28 5.76 3.41
FLOWERS FOODS 22.43   26.4 0.85 0.76 3.40
UNITED PARCEL SERVICE 122.56   22.4 5.47 3.84 3.14
PEPSICO 137.29   15.2 9.02 3.82 2.81
CLOROX 160.20   25.3 6.34 4.24 2.68
HOME DEPOT 233.80   23.3 10.04 5.44 2.33
LAM RESEARCH 234.87   17.1 13.72 4.60 1.90
MCCORMICK 157.81   30.8 5.13 2.28 1.46
CHURCH & DWIGHT 72.65   30.3 2.40 0.91 1.27