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Are You Looking for a High-Growth Dividend Stock? Bank OZK (OZK) Could Be a Great Choice
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All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. 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 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.
Bank OZK in Focus
Headquartered in Little Rock, Bank OZK (OZK - Free Report) is a Finance stock that has seen a price change of 42.44% so far this year. The bank is paying out a dividend of $0.23 per share at the moment, with a dividend yield of 2.83% compared to the Banks - Northeast industry's yield of 1.81% and the S&P 500's yield of 1.94%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.92 is up 15.7% from last year. Over the last 5 years, Bank OZK has increased its dividend 5 times on a year-over-year basis for an average annual increase of 13.81%. Future dividend growth will depend on earnings growth as well as payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Bank OZK's current payout ratio is 27%. This means it paid out 27% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for OZK for this fiscal year. The Zacks Consensus Estimate for 2019 is $3.49 per share, with earnings expected to increase 7.72% from the year ago period.
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. However, not all companies offer 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. 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, OZK is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).
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Are You Looking for a High-Growth Dividend Stock? Bank OZK (OZK) Could Be a Great Choice
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. 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 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.
Bank OZK in Focus
Headquartered in Little Rock, Bank OZK (OZK - Free Report) is a Finance stock that has seen a price change of 42.44% so far this year. The bank is paying out a dividend of $0.23 per share at the moment, with a dividend yield of 2.83% compared to the Banks - Northeast industry's yield of 1.81% and the S&P 500's yield of 1.94%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.92 is up 15.7% from last year. Over the last 5 years, Bank OZK has increased its dividend 5 times on a year-over-year basis for an average annual increase of 13.81%. Future dividend growth will depend on earnings growth as well as payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Bank OZK's current payout ratio is 27%. This means it paid out 27% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for OZK for this fiscal year. The Zacks Consensus Estimate for 2019 is $3.49 per share, with earnings expected to increase 7.72% from the year ago period.
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. However, not all companies offer 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. 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, OZK is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).