Credit Suisse analysts were leaning more toward European dividend plays as the European Central Bank’s looser monetary policy would keep yields low and help make dividend-paying stocks more attractive for income-minded investors.
Additionally, Credit Suisse pointed to six factors that could support dividend stocks ahead: The low yield environment. Regulatory easing. Reasonable valuations for dividend stocks. Rising inflows to high-dividend funds. Strong earnings trends for the group. Lastly, the higher likelihood that European companies will start allocating more to dividends than U.S. companies. [U.S. Dividend ETFs Could Outperform in Low-Yield Environment]
For instance, several companies, including General Motors (NYSE: GM) and 21s Century Fox (NasdaqGS: FOXA), have raised dividends recently. Dividend stocks expanded annualized cash payments by over 10% in January. Howard Silverblatt, senior index analyst at S&P Dow Jones Indices, also pointed out that February is typically the biggest month for dividend hikes and banks should announce dividend changes in March. [Banner Year of Dividend Growth Sends Cash to Dividend ETFs]
For more information on dividend stocks, visit our dividend ETFs category.
Max Chen contributed to this article.