Some investors prefer to invest only in stocks that pay dividends. Dividend-paying stocks are particularly attractive to retirees, who are looking for dividends to provide their retirement income.
Research has shown that dividend-paying stocks have outperformed the general stock market. Doing even better than dividend-paying stocks are stocks that have grown their dividend payments.
Rather than just looking for stocks that have high dividend yields (i.e. high dividends relative to share price), it is helpful to know whether the dividends are on an up or down trend.