Interest or Dividends?
When it comes to investing, when CD rates are high, I am torn. Grabbing five percent on a “safe” CD is certainly attractive. However, I also like the potential of dividend growth. This will be even more important when (if) interest rates decline.
IBM did raise their dividend, but it wasn’t enough to keep pace with inflation. On the other hand, a four percent yield is decent, and I own 600 shares of IBM. Therefore, with the new dividend, my quarterly income from IBM is $1,002 or $334 per month. That, along with the potential to trade covered call options on my IBM shares makes me want to stand pat.
Seeking Alpha Opinion – JR Research
At least one analyst sees potential as well. It isn’t just about the dividend. It is about the potential for growing value.
Company Profile – International Business Machines Corporation
International Business Machines Corporation, together with its subsidiaries, provides integrated solutions and services worldwide. The company operates through Software, Consulting, Infrastructure, and Financing segments. The Software segment offers a hybrid cloud and AI platforms that allows clients to realize their digital and AI transformations across the applications, data, and environments in which they operate. The Consulting segment focuses on skills integration for strategy, experience, technology, and operations by domain and industry. The Infrastructure segment provides on-premises and cloud-based server, and storage solutions, as well as life-cycle services for hybrid cloud infrastructure deployment. The Financing segment offers client and commercial financing, facilitates IBM clients’ acquisition of hardware, software, and services. The company has a strategic partnership to various companies including hyperscalers, service providers, global system integrators, and software and hardware vendors that includes Adobe, Amazon Web services, Microsoft, Oracle, Salesforce, Samsung Electronics and SAP, and others. The company was formerly known as Computing-Tabulating-Recording Co. International Business Machines Corporation was incorporated in 1911 and is headquartered in Armonk, New York.
Full Disclosure
I own 600 shares of IBM as a long-term investment.
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