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Are You Looking for a High-Growth Dividend Stock? Matthews International (MATW) Could Be a Great Choice
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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. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
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.
Matthews International in Focus
Headquartered in Pittsburgh, Matthews International (MATW - Free Report) is a Consumer Staples stock that has seen a price change of 32.52% so far this year. The casket and memorial manufacturer is currently shelling out a dividend of $0.22 per share, with a dividend yield of 2.21%. This compares to the Funeral Services industry's yield of 1.73% and the S&P 500's yield of 1.3%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.86 is up 2.4% from last year. Matthews International has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 7.46%. 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. Matthews International's current payout ratio is 25%. This means it paid out 25% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, MATW expects solid earnings growth. The Zacks Consensus Estimate for 2021 is $3.14 per share, with earnings expected to increase 4.32% 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. 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. With that in mind, MATW presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).
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Are You Looking for a High-Growth Dividend Stock? Matthews International (MATW) Could Be a Great Choice
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
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.
Matthews International in Focus
Headquartered in Pittsburgh, Matthews International (MATW - Free Report) is a Consumer Staples stock that has seen a price change of 32.52% so far this year. The casket and memorial manufacturer is currently shelling out a dividend of $0.22 per share, with a dividend yield of 2.21%. This compares to the Funeral Services industry's yield of 1.73% and the S&P 500's yield of 1.3%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.86 is up 2.4% from last year. Matthews International has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 7.46%. 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. Matthews International's current payout ratio is 25%. This means it paid out 25% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, MATW expects solid earnings growth. The Zacks Consensus Estimate for 2021 is $3.14 per share, with earnings expected to increase 4.32% 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. 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. With that in mind, MATW presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).