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This is Why Eastman Chemical (EMN) is a Great Dividend Stock
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Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Eastman Chemical in Focus
Based in Kingsport, Eastman Chemical (EMN - Free Report) is in the Basic Materials sector, and so far this year, shares have seen a price change of 0.02%. Currently paying a dividend of $0.69 per share, the company has a dividend yield of 2.75%. In comparison, the Chemical - Diversified industry's yield is 1.2%, while the S&P 500's yield is 1.45%.
In terms of dividend growth, the company's current annualized dividend of $2.76 is up 3.4% from last year. Eastman Chemical has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 9.24%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Eastman Chemical's current payout ratio is 45%. This means it paid out 45% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, EMN expects solid earnings growth. The Zacks Consensus Estimate for 2021 is $7.33 per share, which represents a year-over-year growth rate of 19.19%.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. However, not all companies offer a quarterly payout.
For instance, it's a rare occurrence when a tech start-up or big growth business offers their shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, EMN presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).
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This is Why Eastman Chemical (EMN) is a Great Dividend Stock
Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Eastman Chemical in Focus
Based in Kingsport, Eastman Chemical (EMN - Free Report) is in the Basic Materials sector, and so far this year, shares have seen a price change of 0.02%. Currently paying a dividend of $0.69 per share, the company has a dividend yield of 2.75%. In comparison, the Chemical - Diversified industry's yield is 1.2%, while the S&P 500's yield is 1.45%.
In terms of dividend growth, the company's current annualized dividend of $2.76 is up 3.4% from last year. Eastman Chemical has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 9.24%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Eastman Chemical's current payout ratio is 45%. This means it paid out 45% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, EMN expects solid earnings growth. The Zacks Consensus Estimate for 2021 is $7.33 per share, which represents a year-over-year growth rate of 19.19%.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. However, not all companies offer a quarterly payout.
For instance, it's a rare occurrence when a tech start-up or big growth business offers their shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, EMN presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).