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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.
German American Bancorp in Focus
Based in Jasper, German American Bancorp (GABC - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of -7.16%. The financial services holding company is currently shelling out a dividend of $0.23 per share, with a dividend yield of 2.54%. This compares to the Banks - Midwest industry's yield of 3.02% and the S&P 500's yield of 1.78%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.92 is up 9.5% from last year. German American Bancorp has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 11.73%. 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. German American Bancorp's current payout ratio is 29%, meaning it paid out 29% of its trailing 12-month EPS as dividend.
GABC is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2022 is $3.25 per share, with earnings expected to increase 2.52% from the year ago period.
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. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. That said, they can take comfort from the fact that GABC is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).
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Are You Looking for a High-Growth 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.
German American Bancorp in Focus
Based in Jasper, German American Bancorp (GABC - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of -7.16%. The financial services holding company is currently shelling out a dividend of $0.23 per share, with a dividend yield of 2.54%. This compares to the Banks - Midwest industry's yield of 3.02% and the S&P 500's yield of 1.78%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.92 is up 9.5% from last year. German American Bancorp has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 11.73%. 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. German American Bancorp's current payout ratio is 29%, meaning it paid out 29% of its trailing 12-month EPS as dividend.
GABC is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2022 is $3.25 per share, with earnings expected to increase 2.52% from the year ago period.
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. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. That said, they can take comfort from the fact that GABC is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).