New Delhi, Aug. 26 -- Equity investors seeking regular income, potential capital appreciation, and long-term compounding can consider adding dividend stocks to their portfolios, as they provide a stream of cash flow without requiring investors to sell their shares.

However, one shouldn't jump to buy a stock just because it has a high dividend yield, for it can sometimes be a warning sign rather than an opportunity. For example, if a stock price crashes over a certain period, but its dividend remains unchanged, its dividend yield will automatically rise.

The best thing is to focus on earnings visibility, cash flow generation, balance sheet strength, and the sustainability of payouts in a stock rather than just looking at headline dividen...