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Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
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.
NexPoint Residential Trust Inc. In Focus
Headquartered in Dallas, NexPoint Residential Trust Inc. (NXRT - Free Report) is a Finance stock that has seen a price change of -52.17% so far this year. The real estate investment trust is paying out a dividend of $0.38 per share at the moment, with a dividend yield of 3.79% compared to the REIT and Equity Trust - Residential industry's yield of 3.75% and the S&P 500's yield of 1.81%.
Taking a look at the company's dividend growth, its current annualized dividend of $1.52 is up 8.3% from last year. In the past five-year period, NexPoint Residential Trust Inc. has increased its dividend 5 times on a year-over-year basis for an average annual increase of 10.67%. 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. NexPoint Residential Trust Inc.'s current payout ratio is 46%, meaning it paid out 46% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, NXRT expects solid earnings growth. The Zacks Consensus Estimate for 2022 is $3.40 per share, with earnings expected to increase 23.64% from the year ago period.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. 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 have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, NXRT 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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Are You Looking for a High-Growth 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. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
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.
NexPoint Residential Trust Inc. In Focus
Headquartered in Dallas, NexPoint Residential Trust Inc. (NXRT - Free Report) is a Finance stock that has seen a price change of -52.17% so far this year. The real estate investment trust is paying out a dividend of $0.38 per share at the moment, with a dividend yield of 3.79% compared to the REIT and Equity Trust - Residential industry's yield of 3.75% and the S&P 500's yield of 1.81%.
Taking a look at the company's dividend growth, its current annualized dividend of $1.52 is up 8.3% from last year. In the past five-year period, NexPoint Residential Trust Inc. has increased its dividend 5 times on a year-over-year basis for an average annual increase of 10.67%. 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. NexPoint Residential Trust Inc.'s current payout ratio is 46%, meaning it paid out 46% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, NXRT expects solid earnings growth. The Zacks Consensus Estimate for 2022 is $3.40 per share, with earnings expected to increase 23.64% from the year ago period.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. 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 have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, NXRT 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).