A primary goal of this website, along with providing free and concise dividend stock analysis reports, is to share information about dividend investing so that we all may become more educated on the topic. In an earlier post I mentioned that a long-term goal of this website is to present readers with some good books on investing, and I’ve also had readers ask me for book ideas.
I’ve finally gotten to the point where I can offer a review of a book or two. I wanted to find a book that explains the value of dividend stocks, is easily readable, and has plenty of content. I’ve concluded that the number one book I currently want to recommend is The Ultimate Dividend Playbook by Josh Peters, CFA. Peters is the editor of Morningstar’s DividendInvestor Newsletter.
What it has to Offer
The Ultimate Dividend Playbook is a great resource for dividend investors. It explains the benefits and advantages of dividend investing, provides useful information regarding dividend strategy and key metrics, offers a dividend growth model, and shares insight from a professional dividend investor.
-an overview of dividend investing
-dividend metrics and models
-details of dividends
The book is structured such that the first 2/3rds of the 350 page book is the core text, acting as a high level resource for dividend investing. The last 1/3rd of the book is a series of appendices that delve deeper into certain subjects of dividend investing. Throughout the book, Peters makes good use of examples and real-life stocks, and at the end of every chapter is a concise summary of important points. It’s an appropriate length, being long enough to offer a lot of content but concise enough to be interesting and readable.
Are there any Negatives?
Only a few. Probably the biggest downside to this book is the timing in which it was published: right before the economic collapse and global recession. Of the many companies that Peters used as positive examples, a lot of them have done quite well through the crisis, but others have cut their dividends. The only other potential negative I noticed is a small inclusion of advertisements for Morningstar. They are not bothersome, however, as they are infrequent and placed in relevant parts of the text.
Conclusion and Target Audience
Basically, this is an all-around good read for an investor. It covers the topic of dividend-growth-investing on general terms, and then delves into specifics in a number of appendices. In my opinion, this book will be most valuable for:
-New investors interested in dividends
For new investors, this book provides an overview of dividend investing. It explains how dividends work and why they are useful, includes several examples, and provides summaries. The book assumes you have at least a basic grasp of investing, but you don’t need much. Basic math and an understanding of rates of return and compounding are most of what you require. Some of the appendices may take some time for you to work through, but it doesn’t have to be read all at once. That’s why I like the structure of the book. The core of the book is great for anyone to read, and then the appendices that interest you will allow you to explore certain topics with more depth.
-Moderately experienced dividend investors
For those with some experience, this book will strengthen your dividend investing knowledge. A portion of the core book will be already well-understood by you, but the read is still enjoyable. Peters offers his straightforward dividend growth model, and you can compare it to whatever models you currently use and can apply it to your own investments as another tool in your arsenal if you don’t already use something like it. The appendices should be particularly useful for you. There’s an appendix on the nuts and bolts of dividend payments, an appendix on taxes including a mention of foreign taxation, an appendix on evaluating bank stocks, an appendix on evaluating utility stocks, an appendix about REITs, and an appendix about MLPs.
-Investors of any type that currently forgo dividend investing
This book might lead you to look at dividends as a useful investment tool to give to greater returns and more stability, in addition of course to passive income.
Peters addresses his strategy to the young and the retired alike. He explains the benefits of dividends to retirees and showcases the types of stocks that offer high dividend yields to provide you with the current income you require.
For an affiliate product like this, I am committed to only promoting a quality book that I’ve fully read myself and recommend to readers.
MoneyMan @ FinancialOdyssey
Sounds Great, I’m gonna have to check it out. I too invest in high yielding stocks for my stock portfolio. The sad thing is though that sometimes it’s hard to find good information about this investing strategy. Too often people are concerned with stocks of companies that only have growth potential and they fail to realize the benefits of a stock that yields 6% without any appriciation.
It depends on the goals people have. A stock with 6% yield and no dividend growth can be good for a retiree, or for someone who wants to diversify their portfolio into higher yields and lower growth. But for someone who wants 10+% annual returns, they will be looking for some dividend growth in there as well. Dividend growth is also useful to ensure that your income stays ahead of inflation.
I pick some stocks with high yields (like Brookfield Infrastrucuter Partners), but that also carry a little bit of dividend growth with them as well.
Thanks for the tip! I would gladly see more bookreviews on your site:)
landed on this site thru a link. thanks for the book link. does the book advice SIP (systematic investment plan) for dividends or one time?