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.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.
China Petro&Chm in Focus
Based in Beijing, China Petro&Chm is in the Oils-Energy sector, and so far this year, shares have seen a price change of -2.3%. Currently paying a dividend of $4.38 per share, the company has a dividend yield of 19.26%. In comparison, the Oil and Gas - Integrated - Emerging Markets industry's yield is 21.17%, while the S&P 500's yield is 1.66%.
Looking at dividend growth, the company's current annualized dividend of $8.75 is up 118.8% from last year. In the past five-year period, China Petro&Chm has increased its dividend 4 times on a year-over-year basis for an average annual increase of 5.40%. 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. China Petro&Chm's current payout ratio is 45%, meaning it paid out 45% of its trailing 12-month EPS as dividend.
SNP is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2022 is $10.10 per share, with earnings expected to increase 9.66% 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. But, not every company offers 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, SNP 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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This is Why China Petro&Chm (SNP) 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.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.
China Petro&Chm in Focus
Based in Beijing, China Petro&Chm is in the Oils-Energy sector, and so far this year, shares have seen a price change of -2.3%. Currently paying a dividend of $4.38 per share, the company has a dividend yield of 19.26%. In comparison, the Oil and Gas - Integrated - Emerging Markets industry's yield is 21.17%, while the S&P 500's yield is 1.66%.
Looking at dividend growth, the company's current annualized dividend of $8.75 is up 118.8% from last year. In the past five-year period, China Petro&Chm has increased its dividend 4 times on a year-over-year basis for an average annual increase of 5.40%. 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. China Petro&Chm's current payout ratio is 45%, meaning it paid out 45% of its trailing 12-month EPS as dividend.
SNP is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2022 is $10.10 per share, with earnings expected to increase 9.66% 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. But, not every company offers 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, SNP 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).