The dividend stocks is a payment made by a corporation to its shareholders, usually as a distribution of profits.When a corporation earns a profit or surplus, it can re-invest it in the business (called retained earnings), and pay a fraction of the profit as a dividend to shareholders. Distribution to shareholders can be in cash (usually a deposit into a bank account) or, if the corporation has a dividend reinvestment plan, the amount can be paid by the issue of further shares or share repurchase. The dividend stocks is allocated as a fixed amount per share, with shareholders receiving a dividend in proportion to their shareholding. For the joint-stock company, paying dividends is not an expense; rather, it is the division of after tax profits among shareholders. Retained earnings (profits that have not been distributed as dividends) are shown in the shareholders’ equity section on the company’s balance sheet - the same as its issued share capital. Public companies usually pay dividends on a fixed schedule, but may declare a dividend at any time, sometimes called a special dividend to distinguish it from the fixed schedule dividends. on the other hand, allocate dividends according to members’ activity, so their dividends are often considered to be a pre-tax expense.
The thing about investment is that you can only recieve as much as you put in. Take for instance farming, you cannot plant two seeds on 100acres of land and expect the whole land to be full of plants at harvest time. You will recieve yield based on what you planted. It's the same thing with investment in stocks or otherwise, how much you recieve, is dependent on how much you put in, in terms of time and money. For instance if you hold $100 of shares, instead of receiving cash dividends and spending them, you can choose the option of dividend stocks. This means that you are being paid in form of additional shares rather than cash payments. And the more shares you are holding, the more profits you are getting, especially if it's a consistently growing company.