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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 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.
Greenbrier Companies in Focus
Headquartered in Lake Oswego, Greenbrier Companies (GBX - Free Report) is a Transportation stock that has seen a price change of 16.61% so far this year. The maker of railroad freight car equipment is paying out a dividend of $0.3 per share at the moment, with a dividend yield of 2.33% compared to the Transportation - Equipment and Leasing industry's yield of 1.69% and the S&P 500's yield of 1.57%.
Looking at dividend growth, the company's current annualized dividend of $1.20 is up 8.1% from last year. Greenbrier Companies has increased its dividend 2 times on a year-over-year basis over the last 5 years for an average annual increase of 2.66%. 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. Greenbrier's current payout ratio is 31%. This means it paid out 31% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for GBX for this fiscal year. The Zacks Consensus Estimate for 2024 is $4.23 per share, which represents a year-over-year growth rate of 42.42%.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. But, not every company offers 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 GBX is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #1 (Strong 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 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.
Greenbrier Companies in Focus
Headquartered in Lake Oswego, Greenbrier Companies (GBX - Free Report) is a Transportation stock that has seen a price change of 16.61% so far this year. The maker of railroad freight car equipment is paying out a dividend of $0.3 per share at the moment, with a dividend yield of 2.33% compared to the Transportation - Equipment and Leasing industry's yield of 1.69% and the S&P 500's yield of 1.57%.
Looking at dividend growth, the company's current annualized dividend of $1.20 is up 8.1% from last year. Greenbrier Companies has increased its dividend 2 times on a year-over-year basis over the last 5 years for an average annual increase of 2.66%. 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. Greenbrier's current payout ratio is 31%. This means it paid out 31% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for GBX for this fiscal year. The Zacks Consensus Estimate for 2024 is $4.23 per share, which represents a year-over-year growth rate of 42.42%.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. But, not every company offers 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 GBX is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #1 (Strong Buy).