Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
M.D.C. Holdings, Inc. In Focus
Headquartered in Denver, M.D.C. Holdings, Inc. is a Construction stock that has seen a price change of -32.42% so far this year. Currently paying a dividend of $0.5 per share, the company has a dividend yield of 5.3%. In comparison, the Building Products - Home Builders industry's yield is 0.63%, while the S&P 500's yield is 1.46%.
Looking at dividend growth, the company's current annualized dividend of $2 is up 19.8% from last year. M.D.C. Holdings, Inc. has increased its dividend 4 times on a year-over-year basis over the last 5 years for an average annual increase of 19.48%. 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. M.D.C. Holdings, Inc.'s current payout ratio is 26%, meaning it paid out 26% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, MDC expects solid earnings growth. The Zacks Consensus Estimate for 2022 is $10.61 per share, with earnings expected to increase 35.50% from the year ago period.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. But, not every company offers 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, MDC is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).
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M.D.C. Holdings, Inc. (MDC) is a Top Dividend Stock Right Now: Should You Buy?
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
M.D.C. Holdings, Inc. In Focus
Headquartered in Denver, M.D.C. Holdings, Inc. is a Construction stock that has seen a price change of -32.42% so far this year. Currently paying a dividend of $0.5 per share, the company has a dividend yield of 5.3%. In comparison, the Building Products - Home Builders industry's yield is 0.63%, while the S&P 500's yield is 1.46%.
Looking at dividend growth, the company's current annualized dividend of $2 is up 19.8% from last year. M.D.C. Holdings, Inc. has increased its dividend 4 times on a year-over-year basis over the last 5 years for an average annual increase of 19.48%. 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. M.D.C. Holdings, Inc.'s current payout ratio is 26%, meaning it paid out 26% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, MDC expects solid earnings growth. The Zacks Consensus Estimate for 2022 is $10.61 per share, with earnings expected to increase 35.50% from the year ago period.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. But, not every company offers 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, MDC is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).