Bottom Line: Investing Is All About Managing Risks And Your Limited Capital Well

GE’s epic failure is an important lesson that there are no certainties on Wall Street. Even the bluest of blue chips can fail, and even dividend aristocrats can be forced to slash their payouts.

This is why it’s always important for investors to periodically check in on their companies. For most once a year is sufficient. For blue chips, you can stretch that to two or even three years for dividend aristocrats or kings. But never ignore four or more years of deteriorating fundamentals, including sales, earnings, cash flow and returns on invested capital.

This is especially critical since investing is never done in a vacuum. There are thousands of potential companies to invest in, including several hundred quality dividend payers. Heck, there are 53 dividend aristocrats (25+ straight years of dividend growth) and 26 dividend kings (50+ consecutive years of payout hikes) from which to start your search for quality blue-chip income growth stocks.

While not every aristocrat is worth owning (some might not meet your portfolio’s goals), there are plenty that offers either high and safe yields, or moderate yields and fast (8+%) dividend growth. And of course, there are plenty of future dividend aristocrats (and champions who aren’t in the S&P 500) that are also great places to put your money.

The bottom line is that with so many great opportunities out there to earn generous, safe, and steadily rising income, there is no reason that investors should cling to perennial fundamental losers (poor capital gains are not a reason to sell, only declining fundamentals). Especially since there’s always some quality blue chip on sale, even during the hottest of bull markets.

Remember that your portfolio is like a business, and what stocks you buy (and what prices you pay) is your capital allocation. Avoid the mistakes that Jeffrey Immelt made at GE. Don’t overpay for companies, don’t overtrade, and whatever you do, don’t ever ignore steadily deteriorating company fundamentals.

9 "Must Own" Growth Stocks For 2019

Get Free Updates

Join thousands of investors who get the latest news, insights and top rated picks from StockNews.com!

Top Stories on StockNews.com

: ACB | Aurora Cannabis Inc. Common Shares News, Ratings, and Charts

Are shares of Aurora Cannabis (ACB) getting ready to break out?

Aurora Cannabis has been under downward pressure lately, primarily because of the broader market becoming increasingly risk averse.
NYSE: ORCL | Oracle Corporation Common Stock News, Ratings, and Charts

Macquarie Research downgrades Oracle (ORCL) to Neutral

Oracle Corporation was downgraded Tuesday by Macquarie.
NASDAQ: GOOGL | Alphabet Inc. - Class A Common Stock News, Ratings, and Charts

Google (GOOGL) Calendar experiencing a worldwide outage

Google’s website says it has been experiencing a service disruption since about 10:22 a.m. Eastern.
NYSE: BA | Boeing Company (The) Common Stock News, Ratings, and Charts

Boeing (BA) receives a new order for 737 Max planes from British Airways' parent company

IAG said it would buy 200 737 Max planes, orders for which ground to a halt after two fatal crashes.
: hexo | HEXO Corp. Common Shares News, Ratings, and Charts

After its recent dip, is pot stock Hexo (HEXO) a Buy?

Note that the HEXO stock price is about 50% off its 52-week high.

Read More Stories