How to Create Passive Income With Dividend Stocks

So what makes a good dividend stock? The types of businesses that produce steady cash flows that a dividend investor is looking for tend to have similar attributes. We can use these factors as a checklist to begin our investment research:

They are leaders in their industries

They have moats that prevent new entrants

Their industry is growing at GDP growth rates or higher

They can earn money at any point in the business cycle

As a dividend investor, you should check out our Dividend Aristocrats List, which highlights 50 dividend stocks that check each box, its a good place to start finding great stocks that you can hold for decades. But its important to understand why dividend stocks make this list, why is it that some companies can continue to raise dividends year after year, pay good yields, and never cut their dividends? There are some core reasons, and understanding them will make you a better dividend investor.