I like dividends. If the company can pay me a good distribution as a percentage of my invested capital, and if that percentage strongly exceeds what I can get in a savings account, and if the company has a track record of solid and growing dividends, I have a safe investment relative to my risk.
In such an investment, I do not need to concern myself what the Market says the stock is worth. In fact, if the Market is depressed and offers the stock at a bargain price, and if the dividend yield becomes say 20 percent or more, I will take advantage of that opportunity and buy more, if the company itself remains in a durable competitive advantage.
Retained earnings are the company's assumption that they can make a better return for the shareholder with the owner's earnings. In that decision, the earnings are like an advance of additional capital to the company. If the company results in subsequent earnings from the retained earnings, the decision to retain is proven a good one. If instead the subsequent results are a loss, the decision to retain was a poor one.
It is as if the company paid out all its earnings as a dividend, and then asked all the shareholders for the right amount of money for expansion to seize opportunities the company should rightfully pursue. But by retaining the earnings, the shareholders avoid transaction costs and tax consequences of the dividend income.