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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. However, 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 make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Korn/Ferry in Focus
Based in Los Angeles, Korn/Ferry (KFY - Free Report) is in the Business Services sector, and so far this year, shares have seen a price change of 11.41%. Currently paying a dividend of $0.33 per share, the company has a dividend yield of 2%. In comparison, the Staffing Firms industry's yield is 1.42%, while the S&P 500's yield is 1.6%.
Taking a look at the company's dividend growth, its current annualized dividend of $1.32 is up 29.4% from last year. Korn/Ferry has increased its dividend 3 times on a year-over-year basis over the last 5 years for an average annual increase of 19.48%. 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, Korn/Ferry's payout ratio is 31%, which means it paid out 31% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, KFY expects solid earnings growth. The Zacks Consensus Estimate for 2024 is $4.86 per share, representing a year-over-year earnings growth rate of 13.55%.
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.
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 KFY is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).
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Korn/Ferry (KFY) Could Be a Great Choice
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. However, 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 make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Korn/Ferry in Focus
Based in Los Angeles, Korn/Ferry (KFY - Free Report) is in the Business Services sector, and so far this year, shares have seen a price change of 11.41%. Currently paying a dividend of $0.33 per share, the company has a dividend yield of 2%. In comparison, the Staffing Firms industry's yield is 1.42%, while the S&P 500's yield is 1.6%.
Taking a look at the company's dividend growth, its current annualized dividend of $1.32 is up 29.4% from last year. Korn/Ferry has increased its dividend 3 times on a year-over-year basis over the last 5 years for an average annual increase of 19.48%. 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, Korn/Ferry's payout ratio is 31%, which means it paid out 31% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, KFY expects solid earnings growth. The Zacks Consensus Estimate for 2024 is $4.86 per share, representing a year-over-year earnings growth rate of 13.55%.
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.
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 KFY is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).