- Only a few large income stocks rank highly on our dividend quality screen
- The screen is acting as more of a value indicator for smaller companies
Genuine large cap income stocks that score well against our safe yield tests are hard to come by as some of the tests the screen relies on have been failed thanks to the circumstances of the pandemic in the last trailing twelve month period.
The screen is actually more useful as a value indicator than an income screen at the moment, as it is mainly highlighting smaller companies. Still, many of the companies flagged have repeatedly shown up on the screen and given that several of the shares’ prices have re-rated upwards, the screen has been interesting to follow.
Aim stocks flagged by the screen seem to come up short on the dividend cover and interest cover tests, which would suggest these companies aren't for the long term income investor, but the value stories may be worth investigating further.
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