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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. 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.
Associated Banc-Corp in Focus
Based in Green Bay, Associated Banc-Corp (ASB - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of 2.34%. Currently paying a dividend of $0.21 per share, the company has a dividend yield of 3.55%. In comparison, the Banks - Midwest industry's yield is 2.92%, while the S&P 500's yield is 1.58%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.84 is up 3.7% from last year. In the past five-year period, Associated Banc-Corp has increased its dividend 4 times on a year-over-year basis for an average annual increase of 6.64%. 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. Associated Banc-Corp's current payout ratio is 36%. This means it paid out 36% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, ASB expects solid earnings growth. The Zacks Consensus Estimate for 2023 is $2.43 per share, representing a year-over-year earnings growth rate of 3.85%.
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.
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, ASB 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. 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.
Associated Banc-Corp in Focus
Based in Green Bay, Associated Banc-Corp (ASB - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of 2.34%. Currently paying a dividend of $0.21 per share, the company has a dividend yield of 3.55%. In comparison, the Banks - Midwest industry's yield is 2.92%, while the S&P 500's yield is 1.58%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.84 is up 3.7% from last year. In the past five-year period, Associated Banc-Corp has increased its dividend 4 times on a year-over-year basis for an average annual increase of 6.64%. 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. Associated Banc-Corp's current payout ratio is 36%. This means it paid out 36% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, ASB expects solid earnings growth. The Zacks Consensus Estimate for 2023 is $2.43 per share, representing a year-over-year earnings growth rate of 3.85%.
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.
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, ASB 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).