Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. 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.
York Water in Focus
Headquartered in York, York Water (YORW - Free Report) is a Utilities stock that has seen a price change of -10.23% so far this year. The purifying and distribution company is currently shelling out a dividend of $0.2 per share, with a dividend yield of 2.01%. This compares to the Utility - Water Supply industry's yield of 2.02% and the S&P 500's yield of 1.63%.
In terms of dividend growth, the company's current annualized dividend of $0.81 is up 2.9% from last year. In the past five-year period, York Water has increased its dividend 5 times on a year-over-year basis for an average annual increase of 4.03%. 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. Right now, York Water's payout ratio is 56%, which means it paid out 56% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for YORW for this fiscal year. The Zacks Consensus Estimate for 2023 is $1.53 per share, which represents a year-over-year growth rate of 9.29%.
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.
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. That said, they can take comfort from the fact that YORW is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).
4 Oil Stocks with Massive Upsides
Global demand for oil is through the roof... and oil producers are struggling to keep up. So even though oil prices are well off their recent highs, you can expect big profits from the companies that supply the world with "black gold."
Zacks Investment Research has just released an urgent special report to help you bank on this trend.
In Oil Market on Fire, you'll discover 4 unexpected oil and gas stocks positioned for big gains in the coming weeks and months. You don't want to miss these recommendations.
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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 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.
York Water in Focus
Headquartered in York, York Water (YORW - Free Report) is a Utilities stock that has seen a price change of -10.23% so far this year. The purifying and distribution company is currently shelling out a dividend of $0.2 per share, with a dividend yield of 2.01%. This compares to the Utility - Water Supply industry's yield of 2.02% and the S&P 500's yield of 1.63%.
In terms of dividend growth, the company's current annualized dividend of $0.81 is up 2.9% from last year. In the past five-year period, York Water has increased its dividend 5 times on a year-over-year basis for an average annual increase of 4.03%. 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. Right now, York Water's payout ratio is 56%, which means it paid out 56% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for YORW for this fiscal year. The Zacks Consensus Estimate for 2023 is $1.53 per share, which represents a year-over-year growth rate of 9.29%.
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.
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. That said, they can take comfort from the fact that YORW is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).
4 Oil Stocks with Massive Upsides
Global demand for oil is through the roof... and oil producers are struggling to keep up. So even though oil prices are well off their recent highs, you can expect big profits from the companies that supply the world with "black gold."
Zacks Investment Research has just released an urgent special report to help you bank on this trend.
In Oil Market on Fire, you'll discover 4 unexpected oil and gas stocks positioned for big gains in the coming weeks and months. You don't want to miss these recommendations.
Download your free report now to see them.
Get the latest research report on YORW - FREE