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CNO Financial (CNO) is a Top Dividend Stock Right Now: Should You Buy?
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Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. 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 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.
CNO Financial in Focus
CNO Financial (CNO - Free Report) is headquartered in Carmel, and is in the Finance sector. The stock has seen a price change of -8.16% since the start of the year. Currently paying a dividend of $0.12 per share, the company has a dividend yield of 2.88%. In comparison, the Insurance - Multi line industry's yield is 2.8%, while the S&P 500's yield is 1.66%.
In terms of dividend growth, the company's current annualized dividend of $0.48 is up 11.6% from last year. In the past five-year period, CNO Financial has increased its dividend 5 times on a year-over-year basis for an average annual increase of 11.69%. Any future dividend growth will depend on both earnings growth and the company's payout ratio; a payout ratio is the proportion of a firm's annual earnings per share that it pays out as a dividend. Right now, CNO's payout ratio is 25%, which means it paid out 25% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, CNO expects solid earnings growth. The Zacks Consensus Estimate for 2020 is $2 per share, which represents a year-over-year growth rate of 11.11%.
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.
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, CNO is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).
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CNO Financial (CNO) 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 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 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.
CNO Financial in Focus
CNO Financial (CNO - Free Report) is headquartered in Carmel, and is in the Finance sector. The stock has seen a price change of -8.16% since the start of the year. Currently paying a dividend of $0.12 per share, the company has a dividend yield of 2.88%. In comparison, the Insurance - Multi line industry's yield is 2.8%, while the S&P 500's yield is 1.66%.
In terms of dividend growth, the company's current annualized dividend of $0.48 is up 11.6% from last year. In the past five-year period, CNO Financial has increased its dividend 5 times on a year-over-year basis for an average annual increase of 11.69%. Any future dividend growth will depend on both earnings growth and the company's payout ratio; a payout ratio is the proportion of a firm's annual earnings per share that it pays out as a dividend. Right now, CNO's payout ratio is 25%, which means it paid out 25% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, CNO expects solid earnings growth. The Zacks Consensus Estimate for 2020 is $2 per share, which represents a year-over-year growth rate of 11.11%.
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.
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, CNO is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).