3 Dividend Stocks to Avoid Like the Plague

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3 Dividend Stocks to Avoid Like the Plague

Dividend stocks are a fantastic way to build wealth, generate passive income, and benefit from the magic of compound growth. In my recent video here, I shared my top high-dividend-paying stocks from my $4 million portfolio.

While dividend stocks can be a great addition to your investment strategy, it’s essential to remember that not all of them are created equal. In this blog post, we’ll delve into my perspective on three dividend-paying companies that I won’t personally be investing in, whether for financial or moral reasons.

1. Orchid Island Capital Inc (Ticker: ORC):

  • High Dividend Yield: Orchid Island Capital boasts an eye-catching 24% dividend yield, which might tempt many investors.
  • Red Flags: This financial services company from Florida has a market cap of $369 million but only three employees.

    Such a lean team for a publicly traded company raises questions. Additionally, Orchid Island Capital primarily deals with government-guaranteed home loans and relies on the interest rate differential to make profits.

    They also pay fees to another company, Bimini Capital Management. The stock price has been consistently declining since it went public in 2013, signaling potential issues with the company’s performance.

2. Invesco Mortgage Capital Inc (Ticker: IVR):

  • Attractive Dividend: Invesco Mortgage Capital offers a dividend yield of approximately 16%.
  • Downward Spiral: Unfortunately, the stock price of IVR has plummeted by over 94% since its listing on the New York Stock Exchange in 2009. Despite several attempts to navigate the mortgage market, the company’s fund strategy hasn’t yielded positive results.

    Even with dividend reinvestment, the stock is down 61% during a period of strong market performance.

3. Altria Group Inc (Ticker: MO):

  • Dividend King: Altria Group is an old and renowned company with a market cap of $74 billion and a staggering dividend yield of nearly 9.44%.
  • Moral Concerns: However, I have a significant moral objection to investing in this tobacco giant. Altria Group is the leading tobacco manufacturer in the U.S., and my family has experienced the devastating health consequences of tobacco use.

    My mother had breast cancer twice, leading to a double mastectomy, and my father suffered lung damage as a result of his smoking habit. I refuse to invest in a company that contributes to such health problems.


In the world of dividend stock investing, it’s essential to consider not only financial aspects but also your personal values and principles.

My approach highlights the significance of ethical investment choices and being mindful of potential red flags in companies, even if their dividend yields seem enticing.

When you invest in a company, you become a part owner of everything they do, making it crucial to align your investments with your personal beliefs and financial goals.

Whether it’s due to shaky financials or moral objections, these three companies won’t make it into my investment portfolio. Remember, it’s not just about the numbers; ethics matter too in the world of investing.

Join the Invest Diva movement here where we champion these principles and strive to make finance engaging, empowering and prosperous for all.


If you’re ready to become a premium investor and you want to learn how to take control of your financial future and make your money work for you, join me and my fellow Invest Divas and Divos in building a brighter financial future today! Our fun loving and supportive community is ready to welcome!