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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.
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.
Axis Capital in Focus
Axis Capital (AXS - Free Report) is headquartered in Pembroke, and is in the Finance sector. The stock has seen a price change of 1.7% since the start of the year. Currently paying a dividend of $0.44 per share, the company has a dividend yield of 3.19%. In comparison, the Insurance - Property and Casualty industry's yield is 0.68%, while the S&P 500's yield is 1.76%.
Looking at dividend growth, the company's current annualized dividend of $1.76 is up 1.7% from last year. In the past five-year period, Axis Capital has increased its dividend 5 times on a year-over-year basis for an average annual increase of 2.43%. 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, Axis Capital's payout ratio is 29%, which means it paid out 29% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for AXS for this fiscal year. The Zacks Consensus Estimate for 2023 is $7.70 per share, representing a year-over-year earnings growth rate of 32.53%.
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.
High-growth firms or tech start-ups, for example, rarely provide their shareholders a dividend, while larger, more established companies that have more secure profits are often seen as the best dividend options. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, AXS presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).
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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.
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.
Axis Capital in Focus
Axis Capital (AXS - Free Report) is headquartered in Pembroke, and is in the Finance sector. The stock has seen a price change of 1.7% since the start of the year. Currently paying a dividend of $0.44 per share, the company has a dividend yield of 3.19%. In comparison, the Insurance - Property and Casualty industry's yield is 0.68%, while the S&P 500's yield is 1.76%.
Looking at dividend growth, the company's current annualized dividend of $1.76 is up 1.7% from last year. In the past five-year period, Axis Capital has increased its dividend 5 times on a year-over-year basis for an average annual increase of 2.43%. 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, Axis Capital's payout ratio is 29%, which means it paid out 29% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for AXS for this fiscal year. The Zacks Consensus Estimate for 2023 is $7.70 per share, representing a year-over-year earnings growth rate of 32.53%.
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.
High-growth firms or tech start-ups, for example, rarely provide their shareholders a dividend, while larger, more established companies that have more secure profits are often seen as the best dividend options. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, AXS presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).