3 Stocks to Buy With Dividends Yielding More Than 4%

Dividends can provide an important source of investment income to a well-diversified portfolio. However, as with any investment, you need to take prudent steps to ensure that the dividend stock you are considering is actually a good choice.

Merely investing in the highest-yielding stocks is not enough. It's important to do your homework and know why a stock's yield looks attractive. The yield could be high because the stock price has fallen significantly. Or it could be high because management is making poor decisions about how to distribute its excess earnings. Or the excess earnings have fallen, but management isn't adjusting the dividend to match the new lower earnings levels.

Fortunately, there are companies that are doing it right and earning enough to bump up the yield and reward shareholders. Let's discuss three real estate investment trusts (REITs) that dividend-seeking investors should consider adding to their portfolios.

Source Fool.com