Many growth and younger investors may look at dividend paying stocks as "old and crufty", but they miss a very important aspect of this cash flow.
For the long-term investor, dividends make up a significant proportion the investment returns over time. Although dividends are not guaranteed or always growing, good management has a vested interest in seeing that their dividends are consistent and growing. Why? It bodes well as a buffer underneath their stock in down markets and reduces the "down drafts" that effect all stocks in a down market.
If an investor has selected a portfolio of well-managed, conservatively financed companies, the returns can be phenomenal! Moreover, if the investor continues to plow those dividends back into stock purchases, the growth can become exponential over longer periods of time. The key attribute is patience. Dividends are very similar to compounded growth in interest investments. Although dividends are not guaranteed, a diversified portfolio of dividend stocks can and does have great returns over time.
Often young investors are anxious to make their "millions" by chasing growth stocks without dividends, eventually finding that those dreams are mirages in the distance. Like a water hole in the dessert, they arrive at their targeted destination only to find nothing but sand. Sometimes they do find a "watering hole", but, more often, they find a dry hole.
I advocate to my kids to invest in good quality, conservatively managed, dividend paying stocks early in their careers. Then, if they want to take a "winger" on a story growth stock later, give it a shot, but they will already have built a solid base of a growing portfolio. Sometimes, two birds in hand are better than one in the bush.
In an era where patience is in short supply, this view is even less espoused by the young. But if you ask most investors in their 70's and 80's who have a life time of experience in investing, they will often confirm the value of dividends over time.
Sometimes things are different, but this is one tenant that hasn't changed in a very long time and I would not expect it to change anytime soon.