( ) is a stellar dividend stock, primarily for the generous upfront yield, which currently stands at a still-rich 8.4%. Still, even retired income should think of investing to maximize one’s total returns.
Indeed, capital gains may be less appealing through the eyes of a retiree. That said, gains still matter and should not be neglected to maximize upfront yield. Oftentimes, chasing yield with zero consideration for growth can lead to a greater risk of stagnant dividend growth or, worse, a dividend reduction of 50% or more.
Undoubtedly, dividend growth and capital appreciation should all come into play when an investor goes on the hunt for a dividend payer. And while BCE’s dividend looks safe despite its size, there are some fundamental issues that investors will need to put up with. Indeed, the telecom business has been under quite a bit of pressure over these past few years.
Specifically, the media segment has been a real drag. BCE stock: A dividend beauty, but headwinds remain For now, there are no easy solutions for lagging a business. In any case, lower interest rates are one major catalyst for the broader basket of dividend plays, BCE included.
Though I view BCE stock as an intriguing option for those keen on locking in a yield well north of the 8% mark for the long run, I think there are better ways to score a dividend with a side of capital gains. Just as dividends still matter for young investors focused on growth and capital gains, growth is still important for .