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This is Why Western New England Bancorp (WNEB) 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.
Cash flow can come from bond interest, interest from other types of investments, and of course, 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.
Western New England Bancorp in Focus
Western New England Bancorp (WNEB - Free Report) is headquartered in Westfield, and is in the Finance sector. The stock has seen a price change of -1.48% since the start of the year. The bank holding company is paying out a dividend of $0.06 per share at the moment, with a dividend yield of 2.78% compared to the Banks - Foreign industry's yield of 4.35% and the S&P 500's yield of 1.62%.
In terms of dividend growth, the company's current annualized dividend of $0.24 is up 20% from last year. Western New England Bancorp has increased its dividend 3 times on a year-over-year basis over the last 5 years for an average annual increase of 11.32%. 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. Western New England Bancorp's current payout ratio is 23%, meaning it paid out 23% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, WNEB expects solid earnings growth. The Zacks Consensus Estimate for 2022 is $1.03 per share, representing a year-over-year earnings growth rate of 0.98%.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. That said, they can take comfort from the fact that WNEB 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 Western New England Bancorp (WNEB) 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.
Cash flow can come from bond interest, interest from other types of investments, and of course, 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.
Western New England Bancorp in Focus
Western New England Bancorp (WNEB - Free Report) is headquartered in Westfield, and is in the Finance sector. The stock has seen a price change of -1.48% since the start of the year. The bank holding company is paying out a dividend of $0.06 per share at the moment, with a dividend yield of 2.78% compared to the Banks - Foreign industry's yield of 4.35% and the S&P 500's yield of 1.62%.
In terms of dividend growth, the company's current annualized dividend of $0.24 is up 20% from last year. Western New England Bancorp has increased its dividend 3 times on a year-over-year basis over the last 5 years for an average annual increase of 11.32%. 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. Western New England Bancorp's current payout ratio is 23%, meaning it paid out 23% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, WNEB expects solid earnings growth. The Zacks Consensus Estimate for 2022 is $1.03 per share, representing a year-over-year earnings growth rate of 0.98%.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. That said, they can take comfort from the fact that WNEB is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #1 (Strong Buy).