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Why Axis Capital (AXS) is a Great Dividend Stock Right Now
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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. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
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.
Axis Capital in Focus
Headquartered in Pembroke, Axis Capital (AXS - Free Report) is a Finance stock that has seen a price change of 14.01% so far this year. Currently paying a dividend of $0.44 per share, the company has a dividend yield of 2.85%. In comparison, the Insurance - Property and Casualty industry's yield is 0.76%, while the S&P 500's yield is 1.63%.
Taking a look at the company's dividend growth, its current annualized dividend of $1.76 is up 1.7% from last year. Axis Capital has increased its dividend 4 times on a year-over-year basis over the last 5 years for an average annual increase of 2.39%. 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. Axis Capital's current payout ratio is 30%, meaning it paid out 30% of its trailing 12-month EPS as dividend.
AXS is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2023 is $7.52 per share, which represents a year-over-year growth rate of 29.43%.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. However, not all companies offer 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. That said, they can take comfort from the fact that AXS is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #1 (Strong Buy).
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Why Axis Capital (AXS) is a Great Dividend Stock Right Now
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
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.
Axis Capital in Focus
Headquartered in Pembroke, Axis Capital (AXS - Free Report) is a Finance stock that has seen a price change of 14.01% so far this year. Currently paying a dividend of $0.44 per share, the company has a dividend yield of 2.85%. In comparison, the Insurance - Property and Casualty industry's yield is 0.76%, while the S&P 500's yield is 1.63%.
Taking a look at the company's dividend growth, its current annualized dividend of $1.76 is up 1.7% from last year. Axis Capital has increased its dividend 4 times on a year-over-year basis over the last 5 years for an average annual increase of 2.39%. 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. Axis Capital's current payout ratio is 30%, meaning it paid out 30% of its trailing 12-month EPS as dividend.
AXS is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2023 is $7.52 per share, which represents a year-over-year growth rate of 29.43%.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. However, not all companies offer 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. That said, they can take comfort from the fact that AXS is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #1 (Strong Buy).