Dividends matter. Over the past ten years the share price of utility group United Utilities has been nigh-on flat. Yet with dividends, an investor would have enjoyed around a 90% return. But how can you tell whether the dividend payout is safe and won’t be slashed to conserve cash? Many investors focus on a firm’s profits. But a much better approach, says Société Générale (SocGen), is to look at balancesheet strength.
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