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SJW (SJW) is a Top Dividend Stock Right Now: Should You Buy?
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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.
SJW in Focus
Headquartered in San Jose, SJW (SJW - Free Report) is a Utilities stock that has seen a price change of -12.04% so far this year. Currently paying a dividend of $0.4 per share, the company has a dividend yield of 2.78%. In comparison, the Utility - Water Supply industry's yield is 2.14%, while the S&P 500's yield is 1.52%.
Taking a look at the company's dividend growth, its current annualized dividend of $1.60 is up 5.3% from last year. SJW has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 6.05%. 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. SJW's current payout ratio is 58%, meaning it paid out 58% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, SJW expects solid earnings growth. The Zacks Consensus Estimate for 2024 is $2.75 per share, with earnings expected to increase 2.61% 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. 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. With that in mind, SJW 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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SJW (SJW) is a Top Dividend Stock Right Now: Should You Buy?
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.
SJW in Focus
Headquartered in San Jose, SJW (SJW - Free Report) is a Utilities stock that has seen a price change of -12.04% so far this year. Currently paying a dividend of $0.4 per share, the company has a dividend yield of 2.78%. In comparison, the Utility - Water Supply industry's yield is 2.14%, while the S&P 500's yield is 1.52%.
Taking a look at the company's dividend growth, its current annualized dividend of $1.60 is up 5.3% from last year. SJW has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 6.05%. 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. SJW's current payout ratio is 58%, meaning it paid out 58% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, SJW expects solid earnings growth. The Zacks Consensus Estimate for 2024 is $2.75 per share, with earnings expected to increase 2.61% 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. 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. With that in mind, SJW 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).