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Why Independent Bank Corp. (INDB) is a Great Dividend Stock Right Now
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All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. 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 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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Independent Bank Corp. In Focus
Headquartered in Hanovder, Independent Bank Corp. (INDB - Free Report) is a Finance stock that has seen a price change of 14.92% so far this year. The holding company for Rockland Trust is paying out a dividend of $0.48 per share at the moment, with a dividend yield of 2.29% compared to the Banks - Northeast industry's yield of 1.99% and the S&P 500's yield of 1.27%.
Taking a look at the company's dividend growth, its current annualized dividend of $1.92 is up 4.3% from last year. Independent Bank Corp. has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 12.55%. 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, Independent Bank Corp.'s payout ratio is 46%, which means it paid out 46% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, INDB expects solid earnings growth. The Zacks Consensus Estimate for 2021 is $4.44 per share, representing a year-over-year earnings growth rate of 21.31%.
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. But, not every company offers 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. That said, they can take comfort from the fact that INDB is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).
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Why Independent Bank Corp. (INDB) is a Great Dividend Stock Right Now
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. 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 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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Independent Bank Corp. In Focus
Headquartered in Hanovder, Independent Bank Corp. (INDB - Free Report) is a Finance stock that has seen a price change of 14.92% so far this year. The holding company for Rockland Trust is paying out a dividend of $0.48 per share at the moment, with a dividend yield of 2.29% compared to the Banks - Northeast industry's yield of 1.99% and the S&P 500's yield of 1.27%.
Taking a look at the company's dividend growth, its current annualized dividend of $1.92 is up 4.3% from last year. Independent Bank Corp. has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 12.55%. 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, Independent Bank Corp.'s payout ratio is 46%, which means it paid out 46% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, INDB expects solid earnings growth. The Zacks Consensus Estimate for 2021 is $4.44 per share, representing a year-over-year earnings growth rate of 21.31%.
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. But, not every company offers 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. That said, they can take comfort from the fact that INDB is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).