7 Metrics to Check Before Buying a Dividend Stock

Are you thinking about buying a dividend stock? Before you chase the shiny yield or jump into what your buddy recommended, here are the 7 metrics the team checks every single time. These fundamentals help you avoid traps, understand the real health of a business, and invest with confidence.

We break each metric down with real-world context, examples from client portfolios, and why single-year snapshots often mislead investors. If you want a smarter, calmer, more long-term approach to dividend investing — this episode is your playbook.


00:00 – Why Investors Ask About Certain Stocks ✨
Big yields, shiny tickers, and “Vegas lights” often cause investors to ask about specific companies.

02:40 – Intro: 7 Metrics That Actually Matter 📊
What the team looks at before buying any dividend stock.

03:13 – Metric #1: Dividend Payout Ratio 💸
Why lower is better, what the percentage tells you, and when a high number isn't a deal breaker.

04:00 – When High Payout Ratios Mislead ⚠️
Mergers, acquisitions, buybacks, and accounting quirks can distort short-term ratios.

04:32 – The Power of Multi-Year Trends 📈
Why 5-year payout ratio history matters more than a single-year snapshot.

05:18 – Real-Life Analogy for Payout Ratios 🏠
Spending 90% of your income at home = trouble. Same goes for companies.

14:06 – Metric #6: Free Cash Flow (FCF) 💰
Sustainable vs one-time cash flow spikes, and why FCF consistency matters for dividends.

15:05 – Metric #7: Debt Levels & Share Buybacks 🧾
Low debt strengthens the business; buybacks often benefit long-term investors.

15:28 – Final Thoughts: Look At All 7 Metrics Together 🔍
No single number tells the story — evaluate the whole picture.

16:39 – Business First, Yield Last 🏛️
Check financial health before worrying about yield percentages.

17:16 – Gamified Investing Score 🎮
Creating a score helps remove emotion and improve decision-making.

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