Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. 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.
United Technologies in Focus
United Technologies is headquartered in Connecticut, and is in the Conglomerates sector. The stock has seen a price change of 22.12% since the start of the year. The maker of elevators, jet engines and other products is paying out a dividend of $0.74 per share at the moment, with a dividend yield of 2.26% compared to the Diversified Operations industry's yield of 1.49% and the S&P 500's yield of 1.92%.
Taking a look at the company's dividend growth, its current annualized dividend of $2.94 is up 3.7% from last year. United Technologies has increased its dividend 4 times on a year-over-year basis over the last 5 years for an average annual increase of 4.37%. 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. United Technologies's current payout ratio is 38%, meaning it paid out 38% of its trailing 12-month EPS as dividend.
UTX is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2019 is $7.97 per share, representing a year-over-year earnings growth rate of 4.73%.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. However, not all companies offer 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, UTX 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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United Technologies (UTX) is a Top Dividend Stock Right Now: Should You Buy?
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. 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.
United Technologies in Focus
United Technologies is headquartered in Connecticut, and is in the Conglomerates sector. The stock has seen a price change of 22.12% since the start of the year. The maker of elevators, jet engines and other products is paying out a dividend of $0.74 per share at the moment, with a dividend yield of 2.26% compared to the Diversified Operations industry's yield of 1.49% and the S&P 500's yield of 1.92%.
Taking a look at the company's dividend growth, its current annualized dividend of $2.94 is up 3.7% from last year. United Technologies has increased its dividend 4 times on a year-over-year basis over the last 5 years for an average annual increase of 4.37%. 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. United Technologies's current payout ratio is 38%, meaning it paid out 38% of its trailing 12-month EPS as dividend.
UTX is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2019 is $7.97 per share, representing a year-over-year earnings growth rate of 4.73%.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. However, not all companies offer 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, UTX 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).