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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Bankwell Financial Group, Inc. In Focus
Headquartered in New Canaan, Bankwell Financial Group, Inc. (BWFG - Free Report) is a Finance stock that has seen a price change of 4.72% so far this year. Currently paying a dividend of $0.2 per share, the company has a dividend yield of 2.33%. In comparison, the Banks - Northeast industry's yield is 2.37%, while the S&P 500's yield is 1.44%.
Looking at dividend growth, the company's current annualized dividend of $0.80 is up 25% from last year. Bankwell Financial Group, Inc. has increased its dividend 4 times on a year-over-year basis over the last 5 years for an average annual increase of 18.67%. 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. Right now, Bankwell Financial Group, Inc.'s payout ratio is 21%, which means it paid out 21% of its trailing 12-month EPS as dividend.
BWFG is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2022 is $3.63 per share, with earnings expected to increase 8.04% 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.
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. 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 BWFG is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #1 (Strong Buy).
7 Best Stocks for the Next 30 Days
Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."
Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.2% per year. So be sure to give these hand picked 7 your immediate attention.
See them 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 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.
Bankwell Financial Group, Inc. In Focus
Headquartered in New Canaan, Bankwell Financial Group, Inc. (BWFG - Free Report) is a Finance stock that has seen a price change of 4.72% so far this year. Currently paying a dividend of $0.2 per share, the company has a dividend yield of 2.33%. In comparison, the Banks - Northeast industry's yield is 2.37%, while the S&P 500's yield is 1.44%.
Looking at dividend growth, the company's current annualized dividend of $0.80 is up 25% from last year. Bankwell Financial Group, Inc. has increased its dividend 4 times on a year-over-year basis over the last 5 years for an average annual increase of 18.67%. 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. Right now, Bankwell Financial Group, Inc.'s payout ratio is 21%, which means it paid out 21% of its trailing 12-month EPS as dividend.
BWFG is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2022 is $3.63 per share, with earnings expected to increase 8.04% 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.
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. 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 BWFG is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #1 (Strong Buy).
7 Best Stocks for the Next 30 Days
Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."
Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.2% per year. So be sure to give these hand picked 7 your immediate attention.
See them now >>
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