We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why McGrath (MGRC) is a Great Dividend Stock Right Now
Read MoreHide Full Article
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.
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.
McGrath in Focus
Based in Livermore, McGrath (MGRC - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of 3.31%. The business-to-business rental company is paying out a dividend of $0.46 per share at the moment, with a dividend yield of 2.19% compared to the Financial - Leasing Companies industry's yield of 1.09% and the S&P 500's yield of 1.69%.
Looking at dividend growth, the company's current annualized dividend of $1.82 is up 5.5% from last year. McGrath has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 11.87%. 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. McGrath's current payout ratio is 46%. This means it paid out 46% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, MGRC expects solid earnings growth. The Zacks Consensus Estimate for 2022 is $4.12 per share, with earnings expected to increase 12.57% from the year ago period.
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. However, not all companies offer 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. 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, MGRC 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).
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why McGrath (MGRC) is a Great Dividend Stock Right Now
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.
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.
McGrath in Focus
Based in Livermore, McGrath (MGRC - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of 3.31%. The business-to-business rental company is paying out a dividend of $0.46 per share at the moment, with a dividend yield of 2.19% compared to the Financial - Leasing Companies industry's yield of 1.09% and the S&P 500's yield of 1.69%.
Looking at dividend growth, the company's current annualized dividend of $1.82 is up 5.5% from last year. McGrath has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 11.87%. 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. McGrath's current payout ratio is 46%. This means it paid out 46% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, MGRC expects solid earnings growth. The Zacks Consensus Estimate for 2022 is $4.12 per share, with earnings expected to increase 12.57% from the year ago period.
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. However, not all companies offer 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. 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, MGRC 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).