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This is Why Boston Properties (BXP) is a Great Dividend Stock
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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 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.
Boston Properties in Focus
Based in Boston, Boston Properties (BXP - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of -6.47%. The real estate investment trust is paying out a dividend of $0.98 per share at the moment, with a dividend yield of 3.04% compared to the REIT and Equity Trust - Other industry's yield of 3.99% and the S&P 500's yield of 2.07%.
Looking at dividend growth, the company's current annualized dividend of $3.92 is up 2.3% from last year. Over the last 5 years, Boston Properties has increased its dividend 4 times on a year-over-year basis for an average annual increase of 10.91%. 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. Boston Properties's current payout ratio is 56%, meaning it paid out 56% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for BXP for this fiscal year. The Zacks Consensus Estimate for 2020 is $7.59 per share, with earnings expected to increase 8.27% 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.
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, BXP 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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This is Why Boston Properties (BXP) is a Great Dividend Stock
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 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.
Boston Properties in Focus
Based in Boston, Boston Properties (BXP - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of -6.47%. The real estate investment trust is paying out a dividend of $0.98 per share at the moment, with a dividend yield of 3.04% compared to the REIT and Equity Trust - Other industry's yield of 3.99% and the S&P 500's yield of 2.07%.
Looking at dividend growth, the company's current annualized dividend of $3.92 is up 2.3% from last year. Over the last 5 years, Boston Properties has increased its dividend 4 times on a year-over-year basis for an average annual increase of 10.91%. 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. Boston Properties's current payout ratio is 56%, meaning it paid out 56% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for BXP for this fiscal year. The Zacks Consensus Estimate for 2020 is $7.59 per share, with earnings expected to increase 8.27% 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.
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, BXP 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).