6 Dividend Stocks that are Sustainable Twice Over

You don't always have to choose between a financially sustainable and an environmentally sustainable stock

Sunniva Kolostyak 18 June, 2021 | 6:51PM
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Sustainability usually means two things in the investment world – and it can sometimes be confusing to figure out whether it means a stock that is performing well or one that’s doing right by the planet. And unfortunately, the two do not always go hand in hand.

A financially sustainable stock could be defined as one that is consistently providing a dependable dividend - particularly important to income investors seeking reliable payouts. However, such stocks have had a hard time in the past year with many firms forced to slash their payouts last year. That's why investors must be selective, says Dan Lefkovitz, a strategist for Morningstar's Indexes group. “Looking for the most yield-rich areas of the market can often lead you into troubled areas and dividend traps – companies may have a nice-looking yield, which is ultimately unsustainable. You have to really screen for dividend durability, sustainability going forward,” he explains.

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Ferguson PLC10,575.00 GBX0.24Rating
Pearson PLC630.80 GBX2.54Rating
Reckitt Benckiser Group PLC5,391.00 GBX-1.98Rating
RELX PLC2,202.00 GBX0.46Rating
Schroders PLC3,556.00 GBX-0.56Rating
Unilever PLC3,787.00 GBX-1.34Rating

About Author

Sunniva Kolostyak  is data journalist for Morningstar.co.uk