3 dividend growth stocks with a payout ratio below 50%

Investing in stocks with rising dividends is an effective way to build long-term wealth. The key to success is to identify companies that combine sustainable payout ratios with consistent dividend growth. This approach allows investors to benefit from rising earnings as well as potential capital appreciation.

According to research, stocks with specific dividend characteristics tend to generate above-average returns over the long term. Key metrics include payout ratios below 75% and average annual dividend growth over the past five years exceeding 6%. In this article, we review three stocks with low payout ratios and strong dividend growth potential.

Microsoft: The tech giant transforming enterprise IT

Microsoft $MSFT has undergone a fascinating transformation from a pure software company to a diversified technology conglomerate. Its expansion into cloud services through Azure has strengthened its competitive position and created new opportunities for growth.

Although Microsoft offers a…