- Stocks are volatile. While bonds have a defined term and are designed to mature at "par" at the end of that term, stocks are open ended investments and their price will bounce around considerably with any number of market influences. This price movement can easily erode any value derived from the dividends, especially if the investor has to sell for liquidity during a "dip" in price.
- Dividends are discretionary. Again, consider the contrast to bonds: the coupon and maturity on a bond are contractual; if the company fails to honor the terms of the bond, they are in default and the bond owners have legal recourse. Dividends are at the discretion of the company's board; a company can suspend dividends at any time and for a variety of reasons.
- Dividends are volatile. As mentioned above, a company can stop paying a dividend at time, and may also raise or lower dividends for a number of reasons. During the fallout of the 2008 "great recession", General Electric cut their dividend substantially. Below is a 10 year chart of the GE payout in $ per share:
To summarize, dividend paying stocks may be a reasonable fit for investors seeking income, but those stocks come with considerable risks and volatility that must be considered within the broader context of the investor's risk tolerance and investment objectives.