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When the goal is to compound wealth for decades, there is a significant difference between dividend growth and sustainable dividend growth. While the difference is obvious enough, they are two distinctly different investments and should be treated as such. Although we believe that sustainable dividend growth is ultimately what builds wealth over time, that doesn't mean that other investment ideas should be ignored altogether. When a stock gets cheap enough, even if its dividend is questionable, sometimes you have to jump on it.
In this episode, Greg builds on the premise of Episode 18 and examines Oaktree Specialty Lending Corporation ($OCSL), a business development company with a 10%+ yield. At the risk of contradicting himself and the case he made against high yield, he argues that there comes a time when value beats dividend sustainability. While the risks of high-yield investments remain, he uses OCSL to compare dividend growth vs. sustainable dividend growth. Later on, Greg provides updates on companies we have covered in past episodes, and where we view them post-Q4 earnings. If you are interested in the original episodes where we went in-depth into each story, they are linked below:
The Clorox Company ($CLX): Ep. 8 - Dirty vs. Clean Opportunities & Ep. 9 - Greater Volatility and More Uncertainty...
Emerson Electric ($EMR): Ep. 17 - The Dilemma With Slow Growth
3M Co ($MMM): Ep. 15 - You Don't Need A "Winner" to 10x Your Income
United Parcel Service ($UPS): Ep. 19 - Do Dividends Care About Recessions?
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