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Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But 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 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.
Luxfer in Focus
Luxfer (LXFR - Free Report) is headquartered in Manchester, and is in the Industrial Products sector. The stock has seen a price change of -21.7% since the start of the year. The materials technology company specializing in aluminum, magnesium and zirconium is paying out a dividend of $0.13 per share at the moment, with a dividend yield of 3.44% compared to the Manufacturing - General Industrial industry's yield of 0.18% and the S&P 500's yield of 1.76%.
In terms of dividend growth, the company's current annualized dividend of $0.52 is up 4% from last year. In the past five-year period, Luxfer has increased its dividend 2 times on a year-over-year basis for an average annual increase of 7.13%. 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. Right now, Luxfer's payout ratio is 43%, which means it paid out 43% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, LXFR expects solid earnings growth. The Zacks Consensus Estimate for 2022 is $1.44 per share, which represents a year-over-year growth rate of 11.63%.
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. 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, LXFR 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?
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But 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 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.
Luxfer in Focus
Luxfer (LXFR - Free Report) is headquartered in Manchester, and is in the Industrial Products sector. The stock has seen a price change of -21.7% since the start of the year. The materials technology company specializing in aluminum, magnesium and zirconium is paying out a dividend of $0.13 per share at the moment, with a dividend yield of 3.44% compared to the Manufacturing - General Industrial industry's yield of 0.18% and the S&P 500's yield of 1.76%.
In terms of dividend growth, the company's current annualized dividend of $0.52 is up 4% from last year. In the past five-year period, Luxfer has increased its dividend 2 times on a year-over-year basis for an average annual increase of 7.13%. 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. Right now, Luxfer's payout ratio is 43%, which means it paid out 43% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, LXFR expects solid earnings growth. The Zacks Consensus Estimate for 2022 is $1.44 per share, which represents a year-over-year growth rate of 11.63%.
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. 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, LXFR 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).