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All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.
Alexandria Real Estate Equities in Focus
Alexandria Real Estate Equities (ARE - Free Report) is headquartered in Pasadena, and is in the Finance sector. The stock has seen a price change of -40.97% since the start of the year. The life science real estate company is paying out a dividend of $1.15 per share at the moment, with a dividend yield of 3.49% compared to the REIT and Equity Trust - Other industry's yield of 4.12% and the S&P 500's yield of 1.75%.
Taking a look at the company's dividend growth, its current annualized dividend of $4.60 is up 2.7% from last year. Alexandria Real Estate Equities has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 6.50%. Any future dividend growth will depend on both earnings growth and the company's payout ratio; a payout ratio is the proportion of a firm's annual earnings per share that it pays out as a dividend. Right now, Alexandria Real Estate Equities's payout ratio is 58%, which means it paid out 58% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for ARE for this fiscal year. The Zacks Consensus Estimate for 2022 is $8.40 per share, which represents a year-over-year growth rate of 8.25%.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. It's important to keep in mind that not all companies provide a quarterly payout.
Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, ARE 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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Are You Looking for a High-Growth Dividend Stock?
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.
Alexandria Real Estate Equities in Focus
Alexandria Real Estate Equities (ARE - Free Report) is headquartered in Pasadena, and is in the Finance sector. The stock has seen a price change of -40.97% since the start of the year. The life science real estate company is paying out a dividend of $1.15 per share at the moment, with a dividend yield of 3.49% compared to the REIT and Equity Trust - Other industry's yield of 4.12% and the S&P 500's yield of 1.75%.
Taking a look at the company's dividend growth, its current annualized dividend of $4.60 is up 2.7% from last year. Alexandria Real Estate Equities has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 6.50%. Any future dividend growth will depend on both earnings growth and the company's payout ratio; a payout ratio is the proportion of a firm's annual earnings per share that it pays out as a dividend. Right now, Alexandria Real Estate Equities's payout ratio is 58%, which means it paid out 58% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for ARE for this fiscal year. The Zacks Consensus Estimate for 2022 is $8.40 per share, which represents a year-over-year growth rate of 8.25%.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. It's important to keep in mind that not all companies provide a quarterly payout.
Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, ARE 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).