DRP Stock Characteristics and How to Implement a High-Yield Screen
by Wayne A. Thorp
Every June, the AAII Journal publishes a listing of companies offering dividend reinvestment plans (DRPs). For individual investors, DRPs provide a low-cost approach to purchasing shares of the firms offering these plans.
This article discusses the investment characteristics of companies that offer DRPs. One feature that is common to almost all firms offering DRPs is that they pay dividends; this article, therefore, also shows how to implement a basic screen for firms with high dividend yields.
In this article
- A Sector Breakdown
- Comparing Characteristics
- Valuation Comparisons
- Management & Ownership
- A High-Yield Screen
- Price Momentum
- Conclusion
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