If I could keep only one dividend screen, it would be this: high yield, low payout ratio. Everything else is commentary.
- Yield tells you what you get paid; payout ratio tells you whether you keep getting paid - A 5% yield at 40% payout is a company sharing affordable profits; at 110% it is a liquidation with good PR - Run both filters at once in a screener; it kills the traps before you fall in love with them - For capital-heavy businesses, use free-cash-flow payout instead of earnings payout - Compare payout ratios within the sector; utilities can safely run higher than tech
DivPlan ($4.99 one-time) builds your income plan around this screen, so every candidate in it already passes it.