Published on 19 Mar 2024 on Insider Monkey via Yahoo Finance

30 Undervalued Dividend Aristocrats To Buy According to Analysts

In this article, we discuss 30 undervalued dividend aristocrats to buy according to analysts. You can skip our detailed analysis of dividend aristocrats and their performance over the years, and go directly to read 10 Undervalued Dividend Aristocrats To Buy According to Analysts. 

Investors often grapple with the decision of whether to invest in growth stocks or value stocks. While both strategies aim to enhance value for investors, they follow distinct paths. The primary distinction lies in the pricing. Growth stocks tend to be pricier, with high valuations relative to their sales or earnings. Conversely, value stocks are more affordable, with lower stock prices in comparison to their sales or earnings. Over time, both growth and value investment approaches have demonstrated comparable performance, yet historical analysis indicates that value investing has been more advantageous for investors in the long term. According to research published by Josef Lakonishok, Andrei Shleifer, and Robert W. Vishny in the Journal of Finance, value strategies tend to yield superior returns. Various investment strategies centered around purchasing undervalued stocks have consistently outperformed those focused on trendy or high-flying stocks from April 1968 to April 1990.

The research paper also emphasized that value stocks typically offer significantly higher dividend yields and possess stronger fundamental ratios compared to growth stocks. Both Josef Lakonishok and the value investing expert David Dreman have observed that value investing outperforms growth investing approximately 70% of the time, regardless of the size of the companies involved. Their studies, which encompassed various company sizes, revealed that value stocks consistently delivered average returns of slightly over 7% per year higher than growth stocks over extended periods.