Companies that consistently pay dividends tend to be stable and profitable from "summary" of The Little Book of Big Dividends by Charles B. Carlson
One of the most common misconceptions about dividends is that they are only for income-seeking investors. While it is true that dividends provide a steady stream of income, they also serve as a powerful indicator of a company's stability and profitability. Companies that consistently pay dividends tend to have strong financial foundations and solid growth prospects. The act of paying dividends requires a company to have a reliable and consistent cash flow. This means that the company is generating enough profits to not only cover its operating expenses but also to distribute a portion of its earnings to shareholders. Companies that pay dividends are therefore more likely to be financially healthy and well-managed. Furthermore, companies that have a history of paying dividends are often mor...
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