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All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on 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.
Sanofi in Focus
Based in Paris, Sanofi (SNY - Free Report) is in the Medical sector, and so far this year, shares have seen a price change of 9.64%. The drugmaker is paying out a dividend of $1.38 per share at the moment, with a dividend yield of 2.59% compared to the Large Cap Pharmaceuticals industry's yield of 2.61% and the S&P 500's yield of 1.7%.
Looking at dividend growth, the company's current annualized dividend of $1.38 is up 9.5% from last year. Over the last 5 years, Sanofi has increased its dividend 3 times on a year-over-year basis for an average annual increase of 2.54%. 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. Right now, Sanofi's payout ratio is 29%, which means it paid out 29% of its trailing 12-month EPS as dividend.
SNY is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2023 is $4.47 per share, with earnings expected to increase 2.76% 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. However, not all companies offer 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, SNY 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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Sanofi (SNY) Could Be a Great Choice
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on 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.
Sanofi in Focus
Based in Paris, Sanofi (SNY - Free Report) is in the Medical sector, and so far this year, shares have seen a price change of 9.64%. The drugmaker is paying out a dividend of $1.38 per share at the moment, with a dividend yield of 2.59% compared to the Large Cap Pharmaceuticals industry's yield of 2.61% and the S&P 500's yield of 1.7%.
Looking at dividend growth, the company's current annualized dividend of $1.38 is up 9.5% from last year. Over the last 5 years, Sanofi has increased its dividend 3 times on a year-over-year basis for an average annual increase of 2.54%. 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. Right now, Sanofi's payout ratio is 29%, which means it paid out 29% of its trailing 12-month EPS as dividend.
SNY is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2023 is $4.47 per share, with earnings expected to increase 2.76% 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. However, not all companies offer 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, SNY 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).