Dividends are the most reasonable way to get a return on investment. If you want to buy low and sell high, you're playing the greater fool game - why would anyone buy if you think it's time to sell. How should a company stock be priced? It's based on earnings, or in other words the ability to pay dividends. P/E ratio or price to earnings is a direct measure of the ability to pay dividends whether they pay them or not. At a PE of 20, the company could pay a 5 percent dividend. At a PE of 100 your stock purchase is misguided - you either expect the earnings to increase dramatically which would make the price more reasonable, or you expect someone else's investment decision to be more unreasonable than yours.