Even if the market is rough, just “buy without hesitation”! The “billionaire” who built up his wealth from zero sense [Investing in stocks with increasing dividends

Many individual investors are struggling with the timing of their investments as the global stock market is in turmoil due to the situation in the Middle East and other factors. In such a situation, there is a “billionaire” who is gaining support for his “ultimate reproducibility” that does not rely on sense or luck.

He advocates a rational investment technique that targets not just high dividends, but also “dividend-increasing stocks” that will continue to increase their dividends in the future. We will look at his specific strategy and criteria for selecting stocks to steadily accumulate profits without being tossed about by the vagaries of the market.

Profile: Taro Haitou

Mr. Haitou started investing in stocks in 2006 when he was a student. He started investing in stocks in 2006 when he was a student and made a profit at the bottom of the market after the “Livedoor Shock” of that time, but he was hit hard by the “Lehman Shock” in 2008, losing more than one-third of his assets. Through this experience, he rediscovered the value of “dividends that continue to accrue even when stock prices fall,” and switched to dividend stock investments. Currently, 90% of his portfolio consists of stocks with increasing dividends. He does not disclose when he became a billionaire or how his assets have changed. He is the author of “The Best Stock Investment with Annual Dividends of 1 Million Yen” and “Starting with the New NISA!　The Ultimate Stock Investment that Pays 2.4 Million Yen a Year in Dividends”, both of which are bestsellers. 248,000 followers on X.

A billionaire “buys without hesitation

The peak of investment targeting dividends and shareholder special benefits at the end of March has passed, and the stock market entered the new fiscal year in April. However, due to the conflict in the Middle East, stock prices around the world have been fluctuating wildly day by day. Many individual investors may be wondering whether the market is at a low point or whether there will be a bigger decline in the future.

However, Mr. Taro Kaitoh, who has become a “billionaire” by investing in dividend stocks, says, “It is important to continue to buy stocks without being sad or happy about the share price or market movements. His investment methods are known for their “high reproducibility,” and he has about 250,000 followers on “X” (formerly Twitter).

Beware of the “High Dividend Trap

Taro Dividend checks companies’ financial statements and medium-term management plans in order to find stocks that are profitable and offer high dividend yields even during bad economic times. However, he makes a clear distinction by calling his investment style “dividend stock investing” or “increasing dividend stock investing,” rather than “high dividend stock investing.

It is dangerous to assume that because a stock pays out a lot of dividends, it has a high dividend yield. It is possible that for some reason the stock price is stagnant or that excessive dividends are being paid relative to earnings. Even if the dividend yield is temporarily high, it does not necessarily mean that the company can continue to pay that dividend. Subsequently, earnings may deteriorate and the company may reduce or not pay dividends, eventually resulting in a significant decline in the dividend yield.”

In fact, there is no end to the number of companies that pay excessive dividends in order to increase the number of shareholders in order to meet the TSE’s criteria for an increase, and then announce a dividend cut, causing the share price to fall sharply. If one focuses only on dividend yields, there is a danger that one may end up investing in stocks with excessive shareholder return policies.

Even if the current dividend yield is not high, if a company has the ability to earn a solid profit and can pay a stable dividend, there is a high possibility that it will increase its dividend in the future. When checking financial statements and medium-term management plans, we should focus on the “growth potential” of such companies. My investment approach is to collect as many stocks as possible that have a large potential for growth and are likely to increase their dividends.

What is your investment timing?

If you are waiting for the right time to buy when the stock price falls, it will be difficult to move forward. I often say that if the stock price is falling, I buy it immediately, if it is flat, I buy it without hesitation, and if it is at a high price, I buy it with courage. In this way, you should develop the habit of buying without hesitation when you have funds available to invest in stocks, and consider increasing the number of shares you own.”

When the market becomes unstable, it is “common” to wait for the stock price to fall, only to find that it has risen. No one knows whether the stock price will rise or fall. If this is the case, it is a waste of time to try to find the right time to buy a stock. Rather, it is a rational way of thinking that we should devote our efforts to finding stocks that will properly increase their dividends.

By taking the time to accumulate dividend payments, enjoy the increased dividends, and then use the dividends to buy more stocks, the impact of the share price and dividend yield on investment performance at the time of acquisition will diminish.

Six Criteria for Spotting Dividend Increasing Stocks

So how can we find stocks that are expected to increase their dividends in the future? We have a very clear answer to this question as well.

Stocks with solid performance, rising earnings per share, and a positive attitude toward returning profits to shareholders. The six specific criteria are as follows.

Taro Dividend’s six criteria for stocks with increasing dividends

• (1) Large companies with a market capitalization of over 1 trillion yen.
• (2) Famous companies that everyone has heard of.
• (iii) Top or top-tier companies in the industry (iv) Companies that are “indispensable” to the world
• 4) Companies in industries that are “essential” to the world
• (5) Companies in industries with high barriers to entry
• 6) Companies in businesses with high “profit margin

Industries and business sectors that fall into (4), (5), and (6) include banking and finance, trading companies, insurance, and telecommunications companies.

Mr. Kaitaro, who became a billionaire by buying well-known companies without any sense or special techniques, has arrived at “investing in stocks with increasing dividends. In the paid version of FRIDAY Subscription, he introduces in detail three stocks that meet his six criteria and are expected to contribute to earnings in the future, even if they are not currently considered material.

Click here to see Mr. Taro’s X