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Why First Busey (BUSE) is a Top Dividend Stock for Your Portfolio
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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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
First Busey in Focus
First Busey (BUSE - Free Report) is headquartered in Champaign, and is in the Finance sector. The stock has seen a price change of -0.67% since the start of the year. Currently paying a dividend of $0.2 per share, the company has a dividend yield of 2.69%. In comparison, the Banks - Midwest industry's yield is 2.07%, while the S&P 500's yield is 1.87%.
In terms of dividend growth, the company's current annualized dividend of $0.80 is up 11.1% from last year. In the past five-year period, First Busey has increased its dividend 4 times on a year-over-year basis for an average annual increase of 9.64%. 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. First Busey's current payout ratio is 42%. This means it paid out 42% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for BUSE for this fiscal year. The Zacks Consensus Estimate for 2018 is $2.14 per share, which represents a year-over-year growth rate of 32.92%.
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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, BUSE 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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Why First Busey (BUSE) is a Top Dividend Stock for Your Portfolio
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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
First Busey in Focus
First Busey (BUSE - Free Report) is headquartered in Champaign, and is in the Finance sector. The stock has seen a price change of -0.67% since the start of the year. Currently paying a dividend of $0.2 per share, the company has a dividend yield of 2.69%. In comparison, the Banks - Midwest industry's yield is 2.07%, while the S&P 500's yield is 1.87%.
In terms of dividend growth, the company's current annualized dividend of $0.80 is up 11.1% from last year. In the past five-year period, First Busey has increased its dividend 4 times on a year-over-year basis for an average annual increase of 9.64%. 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. First Busey's current payout ratio is 42%. This means it paid out 42% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for BUSE for this fiscal year. The Zacks Consensus Estimate for 2018 is $2.14 per share, which represents a year-over-year growth rate of 32.92%.
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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, BUSE 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).