Thanks to jkm929 on the Deranged Monkey Criticism Board for this link:Morningstar Course 408: The Case for Dividendshttp://news.morningstar.com/classroom2/course.asp?docId=1452...In Jeremy Siegel's The Future for Investors, the market's top professor analyzed the returns of the original S&P 500 companies from the formation of the index in 1957 through the end of 2003. What was the best-performing stock?The best of the best hails not from a hot, rapidly growing industry, but instead from a field that was actually surrendering customers the entire time: cigarette maker Philip Morris, now known as Altria Group (MO). Over Siegel's 46-year time frame, Philip Morris posted total returns of an incredible 19.75% per year.What was the secret? Credit a one-two punch of high dividends and profitable, moat-protected growth. Philip Morris made some acquisitions over the years, which were generally successful--but the overwhelming majority of its free cash flow was paid out as dividends or used to repurchase shares.Amazingly, by maximizing boring old dividends and share buybacks, a low-growth business can turn out to be the highest total return investment of all time. As Siegel makes abundantly clear, "growth does not equal return." Only profitable growth--in businesses protected by an economic moat--can do that.
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