That is an interesting chart. It doesn't make sense for the forward EPS and price of oil to be so far out of whack, so it may be a good idea to just keep an eye for now.
%% Fundamentals look bullish for stocks-- except rising FED rates, rising yields, old age in bull market+ 200 dma. And Fidelity ContrafFund again noted risk of S&P downgrade of US debt + more risk could be refinance risk. And early NOV i mentioned strong seasonals, 1st quarter, last quarter which, in past, favored bull//uptrend; but not this year, too late in the year. BUT with dividends SPY,QQQ = still positive/UP 2018-not a good uptrend.Im still bullish on IWM-but that smallcap ETF is down for year.................................................................................................................................
It's worth stopping to think about what "dividend paying stock" means. A stock that pays a $1.00 dividend is worth exactly $1.00 less the day it goes ex. If you had two identical companies, one that paid dividends and one that didn't, you'd have the same value at the end of a year with the dividends plus stock company as the all stock company. There's no "cushion" from dividends, a company that's losing $X per year is going to go down regardless of what they pay in dividends the same as one that doesn't. It's a common misconception that there's some kind of magic "cushion" from dividends that just doesn't exist. There are reasons to invest in a dividend yielding company, just not any you've articulated in this thread. If you would rather invest in a company that believes that investing in their own company will yield inferior returns to what their investors could earn on their own then you would want to choose a dividend yielding company. That sounds pejorative, but it might actually match your thesis. If you want an oil company that's just going to milk what they have but not waste any investment in new exploration or development because they see no future there and you agree with that thesis, then you'd choose a dividend paying oil company over one that didn't pay dividends. A great example of this was when Sprint put their high margin but dying local exchange business into a spin-off (Embarq) that was designed to pay high yields while it slowly died and the high growth wireless business remained with Sprint.
Well that's funny because that's exactly what I said originally. I don't look at dividend stocks for capital gains or growth. Generally if they do or would keep pace with inflation.