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Why Middlesex Water (MSEX) is a Great Dividend Stock Right Now
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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. 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 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 make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Middlesex Water in Focus
Headquartered in Iselin, Middlesex Water (MSEX - Free Report) is a Utilities stock that has seen a price change of 17.77% so far this year. The water utility is currently shelling out a dividend of $0.34 per share, with a dividend yield of 2.19%. This compares to the Utility - Water Supply industry's yield of 2.36% and the S&P 500's yield of 1.66%.
Looking at dividend growth, the company's current annualized dividend of $1.36 is up 3.4% from last year. Middlesex Water has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 6.15%. 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. Middlesex Water's current payout ratio is 55%. This means it paid out 55% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, MSEX expects solid earnings growth. The Zacks Consensus Estimate for 2025 is $2.53 per share, with earnings expected to increase 2.43% 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. It's important to keep in mind that not all companies provide 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. Income investors must be conscious 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 MSEX 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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Why Middlesex Water (MSEX) is a Great Dividend Stock Right Now
Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. 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 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 make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Middlesex Water in Focus
Headquartered in Iselin, Middlesex Water (MSEX - Free Report) is a Utilities stock that has seen a price change of 17.77% so far this year. The water utility is currently shelling out a dividend of $0.34 per share, with a dividend yield of 2.19%. This compares to the Utility - Water Supply industry's yield of 2.36% and the S&P 500's yield of 1.66%.
Looking at dividend growth, the company's current annualized dividend of $1.36 is up 3.4% from last year. Middlesex Water has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 6.15%. 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. Middlesex Water's current payout ratio is 55%. This means it paid out 55% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, MSEX expects solid earnings growth. The Zacks Consensus Estimate for 2025 is $2.53 per share, with earnings expected to increase 2.43% 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. It's important to keep in mind that not all companies provide 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. Income investors must be conscious 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 MSEX is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #1 (Strong Buy).