All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. 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.
Telekom Austria AG in Focus
Headquartered in Vienna, Telekom Austria AG is a Utilities stock that has seen a price change of 13.35% so far this year. Currently paying a dividend of $0.59 per share, the company has a dividend yield of 3.29%. In comparison, the Diversified Communication Services industry's yield is 0.67%, while the S&P 500's yield is 1.29%.
In terms of dividend growth, the company's current annualized dividend of $0.59 is up 13.2% from last year. Telekom Austria AG has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 37.62%. 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. Telekom Austria AG's current payout ratio is 40%. This means it paid out 40% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, TKAGY expects solid earnings growth. The Zacks Consensus Estimate for 2021 is $1.50 per share, representing a year-over-year earnings growth rate of 13.64%.
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.
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 must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, TKAGY 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).
Image: Bigstock
Why Telekom Austria AG (TKAGY) 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. 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.
Telekom Austria AG in Focus
Headquartered in Vienna, Telekom Austria AG is a Utilities stock that has seen a price change of 13.35% so far this year. Currently paying a dividend of $0.59 per share, the company has a dividend yield of 3.29%. In comparison, the Diversified Communication Services industry's yield is 0.67%, while the S&P 500's yield is 1.29%.
In terms of dividend growth, the company's current annualized dividend of $0.59 is up 13.2% from last year. Telekom Austria AG has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 37.62%. 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. Telekom Austria AG's current payout ratio is 40%. This means it paid out 40% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, TKAGY expects solid earnings growth. The Zacks Consensus Estimate for 2021 is $1.50 per share, representing a year-over-year earnings growth rate of 13.64%.
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.
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 must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, TKAGY 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).