I love income. But all too often, income investors are missing out. We see too many companies these days frittering away their earnings on overpriced acquisitions or frivolous “stock-based compensation.”
So, we like to make sure we’re paid our share of the business’s income… via a dividend check in our hands.
But that can limit us. Even as income investors, we’re still investors. By focusing on the best income-producing investments, a lot of folks miss out on a class of magical, high-return stocks called “compounders.”
True compounders, however, are rare. To be one, a company needs to accomplish at least three difficult things…
This post originally appeared at DailyWealth.