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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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
CNO Financial in Focus
Headquartered in Carmel, CNO Financial (CNO - Free Report) is a Finance stock that has seen a price change of 7.75% so far this year. The insurance holding company is currently shelling out a dividend of $0.14 per share, with a dividend yield of 2.27%. This compares to the Insurance - Multi line industry's yield of 1.89% and the S&P 500's yield of 1.61%.
In terms of dividend growth, the company's current annualized dividend of $0.56 is up 1.8% from last year. In the past five-year period, CNO Financial has increased its dividend 5 times on a year-over-year basis for an average annual increase of 9.06%. 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. CNO's current payout ratio is 24%. This means it paid out 24% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for CNO for this fiscal year. The Zacks Consensus Estimate for 2023 is $2.35 per share, which represents a year-over-year growth rate of 0.86%.
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. But, not every company offers 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 have to be mindful 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 CNO is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).
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CNO Financial (CNO) Could Be a Great Choice
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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
CNO Financial in Focus
Headquartered in Carmel, CNO Financial (CNO - Free Report) is a Finance stock that has seen a price change of 7.75% so far this year. The insurance holding company is currently shelling out a dividend of $0.14 per share, with a dividend yield of 2.27%. This compares to the Insurance - Multi line industry's yield of 1.89% and the S&P 500's yield of 1.61%.
In terms of dividend growth, the company's current annualized dividend of $0.56 is up 1.8% from last year. In the past five-year period, CNO Financial has increased its dividend 5 times on a year-over-year basis for an average annual increase of 9.06%. 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. CNO's current payout ratio is 24%. This means it paid out 24% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for CNO for this fiscal year. The Zacks Consensus Estimate for 2023 is $2.35 per share, which represents a year-over-year growth rate of 0.86%.
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. But, not every company offers 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 have to be mindful 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 CNO is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).