Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. 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 make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Washington Federal in Focus
Washington Federal (WAFD) is headquartered in Seattle, and is in the Finance sector. The stock has seen a price change of -1.68% since the start of the year. Currently paying a dividend of $0.24 per share, the company has a dividend yield of 2.92%. In comparison, the Banks - West industry's yield is 2.2%, while the S&P 500's yield is 1.46%.
Looking at dividend growth, the company's current annualized dividend of $0.96 is up 5.5% from last year. In the past five-year period, Washington Federal has increased its dividend 5 times on a year-over-year basis for an average annual increase of 11.14%. 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. Washington Federal's current payout ratio is 35%. This means it paid out 35% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for WAFD for this fiscal year. The Zacks Consensus Estimate for 2022 is $2.95 per share, which represents a year-over-year growth rate of 23.43%.
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. It's important to keep in mind that not all companies provide 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, WAFD 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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This is Why Washington Federal (WAFD) is a Great Dividend Stock
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. 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 make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Washington Federal in Focus
Washington Federal (WAFD) is headquartered in Seattle, and is in the Finance sector. The stock has seen a price change of -1.68% since the start of the year. Currently paying a dividend of $0.24 per share, the company has a dividend yield of 2.92%. In comparison, the Banks - West industry's yield is 2.2%, while the S&P 500's yield is 1.46%.
Looking at dividend growth, the company's current annualized dividend of $0.96 is up 5.5% from last year. In the past five-year period, Washington Federal has increased its dividend 5 times on a year-over-year basis for an average annual increase of 11.14%. 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. Washington Federal's current payout ratio is 35%. This means it paid out 35% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for WAFD for this fiscal year. The Zacks Consensus Estimate for 2022 is $2.95 per share, which represents a year-over-year growth rate of 23.43%.
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. It's important to keep in mind that not all companies provide 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, WAFD 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).