Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.
Reinsurance Group in Focus
Headquartered in Chesterfield, Reinsurance Group (RGA - Free Report) is a Finance stock that has seen a price change of 0.61% so far this year. The reinsurance company is currently shelling out a dividend of $0.85 per share, with a dividend yield of 2.38%. This compares to the Insurance - Life Insurance industry's yield of 0.06% and the S&P 500's yield of 1.67%.
Looking at dividend growth, the company's current annualized dividend of $3.40 is up 11.1% from last year. In the past five-year period, Reinsurance Group has increased its dividend 4 times on a year-over-year basis for an average annual increase of 6.12%. 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. Reinsurance Group's current payout ratio is 18%. This means it paid out 18% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, RGA expects solid earnings growth. The Zacks Consensus Estimate for 2023 is $18.13 per share, representing a year-over-year earnings growth rate of 25.64%.
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. 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. That said, they can take comfort from the fact that RGA is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).
4 Oil Stocks with Massive Upsides
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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 for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.
Reinsurance Group in Focus
Headquartered in Chesterfield, Reinsurance Group (RGA - Free Report) is a Finance stock that has seen a price change of 0.61% so far this year. The reinsurance company is currently shelling out a dividend of $0.85 per share, with a dividend yield of 2.38%. This compares to the Insurance - Life Insurance industry's yield of 0.06% and the S&P 500's yield of 1.67%.
Looking at dividend growth, the company's current annualized dividend of $3.40 is up 11.1% from last year. In the past five-year period, Reinsurance Group has increased its dividend 4 times on a year-over-year basis for an average annual increase of 6.12%. 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. Reinsurance Group's current payout ratio is 18%. This means it paid out 18% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, RGA expects solid earnings growth. The Zacks Consensus Estimate for 2023 is $18.13 per share, representing a year-over-year earnings growth rate of 25.64%.
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. 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. That said, they can take comfort from the fact that RGA is not only an attractive dividend play, but also represents 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 RGA - FREE