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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 for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.
Brookfield Infrastructure Partners in Focus
Based in Hamilton, Brookfield Infrastructure Partners (BIP - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of -6.51%. The operator of utility, transportation and energy assets is currently shelling out a dividend of $0.41 per share, with a dividend yield of 5.5%. This compares to the REIT and Equity Trust - Other industry's yield of 4.3% and the S&P 500's yield of 1.59%.
Looking at dividend growth, the company's current annualized dividend of $1.62 is up 5.9% from last year. In the past five-year period, Brookfield Infrastructure Partners has increased its dividend 4 times on a year-over-year basis for an average annual increase of 3.30%. 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, Brookfield Infrastructure's payout ratio is 52%, which means it paid out 52% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, BIP expects solid earnings growth. The Zacks Consensus Estimate for 2024 is $3.32 per share, representing a year-over-year earnings growth rate of 12.54%.
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. It's important to keep in mind that not all companies provide 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 must be conscious 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 BIP is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).
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Are You Looking for a High-Growth Dividend Stock?
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.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.
Brookfield Infrastructure Partners in Focus
Based in Hamilton, Brookfield Infrastructure Partners (BIP - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of -6.51%. The operator of utility, transportation and energy assets is currently shelling out a dividend of $0.41 per share, with a dividend yield of 5.5%. This compares to the REIT and Equity Trust - Other industry's yield of 4.3% and the S&P 500's yield of 1.59%.
Looking at dividend growth, the company's current annualized dividend of $1.62 is up 5.9% from last year. In the past five-year period, Brookfield Infrastructure Partners has increased its dividend 4 times on a year-over-year basis for an average annual increase of 3.30%. 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, Brookfield Infrastructure's payout ratio is 52%, which means it paid out 52% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, BIP expects solid earnings growth. The Zacks Consensus Estimate for 2024 is $3.32 per share, representing a year-over-year earnings growth rate of 12.54%.
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. It's important to keep in mind that not all companies provide 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 must be conscious 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 BIP is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).