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This is Why Oxford Industries (OXM) is a Great Dividend Stock
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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.
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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Oxford Industries in Focus
Headquartered in Atlanta, Oxford Industries (OXM - Free Report) is a Consumer Discretionary stock that has seen a price change of -12.82% so far this year. Currently paying a dividend of $0.55 per share, the company has a dividend yield of 2.49%. In comparison, the Textile - Apparel industry's yield is 0.12%, while the S&P 500's yield is 1.76%.
Taking a look at the company's dividend growth, its current annualized dividend of $2.20 is up 35% from last year. In the past five-year period, Oxford Industries has increased its dividend 3 times on a year-over-year basis for an average annual increase of 5.18%. 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. Right now, Oxford Industries's payout ratio is 23%, which means it paid out 23% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, OXM expects solid earnings growth. The Zacks Consensus Estimate for 2022 is $9.88 per share, representing a year-over-year earnings growth rate of 23.65%.
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.
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. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. That said, they can take comfort from the fact that OXM is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #1 (Strong Buy).
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This is Why Oxford Industries (OXM) is a Great Dividend Stock
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.
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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Oxford Industries in Focus
Headquartered in Atlanta, Oxford Industries (OXM - Free Report) is a Consumer Discretionary stock that has seen a price change of -12.82% so far this year. Currently paying a dividend of $0.55 per share, the company has a dividend yield of 2.49%. In comparison, the Textile - Apparel industry's yield is 0.12%, while the S&P 500's yield is 1.76%.
Taking a look at the company's dividend growth, its current annualized dividend of $2.20 is up 35% from last year. In the past five-year period, Oxford Industries has increased its dividend 3 times on a year-over-year basis for an average annual increase of 5.18%. 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. Right now, Oxford Industries's payout ratio is 23%, which means it paid out 23% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, OXM expects solid earnings growth. The Zacks Consensus Estimate for 2022 is $9.88 per share, representing a year-over-year earnings growth rate of 23.65%.
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.
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. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. That said, they can take comfort from the fact that OXM is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #1 (Strong Buy).