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Why Matthews International (MATW) is a Top Dividend Stock for Your Portfolio
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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.
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
Matthews International (MATW - Free Report) is headquartered in Pittsburgh, and is in the Consumer Staples sector. The stock has seen a price change of 22.89% since the start of the year. Currently paying a dividend of $0.22 per share, the company has a dividend yield of 2.38%. In comparison, the Funeral Services industry's yield is 1.86%, while the S&P 500's yield is 1.35%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.86 is up 2.4% from last year. Over the last 5 years, Matthews International has increased its dividend 5 times on a year-over-year basis 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.
MATW is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2021 is $3.14 per share, representing a year-over-year earnings growth rate of 4.32%.
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.
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. With that in mind, MATW 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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Why Matthews International (MATW) is a Top Dividend Stock for Your Portfolio
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.
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
Matthews International (MATW - Free Report) is headquartered in Pittsburgh, and is in the Consumer Staples sector. The stock has seen a price change of 22.89% since the start of the year. Currently paying a dividend of $0.22 per share, the company has a dividend yield of 2.38%. In comparison, the Funeral Services industry's yield is 1.86%, while the S&P 500's yield is 1.35%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.86 is up 2.4% from last year. Over the last 5 years, Matthews International has increased its dividend 5 times on a year-over-year basis 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.
MATW is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2021 is $3.14 per share, representing a year-over-year earnings growth rate of 4.32%.
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.
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. With that in mind, MATW 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).