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Are You Looking for a High-Growth Dividend Stock? Huntington Bancshares (HBAN) 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.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on 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.
Huntington Bancshares in Focus
Huntington Bancshares (HBAN - Free Report) is headquartered in Columbus, and is in the Finance sector. The stock has seen a price change of -1.56% since the start of the year. The regional bank holding company is paying out a dividend of $0.16 per share at the moment, with a dividend yield of 4.08% compared to the Banks - Midwest industry's yield of 2.43% and the S&P 500's yield of 1.38%.
In terms of dividend growth, the company's current annualized dividend of $0.62 is up 2.5% from last year. Over the last 5 years, Huntington Bancshares has increased its dividend 4 times on a year-over-year basis for an average annual increase of 14.16%. 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. Huntington Bancshares's current payout ratio is 40%. This means it paid out 40% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for HBAN for this fiscal year. The Zacks Consensus Estimate for 2022 is $1.43 per share, with earnings expected to increase 32.41% from the year ago period.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. However, not all companies offer a quarterly payout.
Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. 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, HBAN 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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Are You Looking for a High-Growth Dividend Stock? Huntington Bancshares (HBAN) 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.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on 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.
Huntington Bancshares in Focus
Huntington Bancshares (HBAN - Free Report) is headquartered in Columbus, and is in the Finance sector. The stock has seen a price change of -1.56% since the start of the year. The regional bank holding company is paying out a dividend of $0.16 per share at the moment, with a dividend yield of 4.08% compared to the Banks - Midwest industry's yield of 2.43% and the S&P 500's yield of 1.38%.
In terms of dividend growth, the company's current annualized dividend of $0.62 is up 2.5% from last year. Over the last 5 years, Huntington Bancshares has increased its dividend 4 times on a year-over-year basis for an average annual increase of 14.16%. 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. Huntington Bancshares's current payout ratio is 40%. This means it paid out 40% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for HBAN for this fiscal year. The Zacks Consensus Estimate for 2022 is $1.43 per share, with earnings expected to increase 32.41% from the year ago period.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. However, not all companies offer a quarterly payout.
Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. 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, HBAN 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).