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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 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 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.
Manulife Financial in Focus
Headquartered in Toronto, Manulife Financial (MFC - Free Report) is a Finance stock that has seen a price change of 4.39% so far this year. The financial services company is currently shelling out a dividend of $0.3 per share, with a dividend yield of 5.16%. This compares to the Insurance - Life Insurance industry's yield of 0.69% and the S&P 500's yield of 1.61%.
Taking a look at the company's dividend growth, its current annualized dividend of $1.19 is up 9.9% from last year. Manulife Financial has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 9.63%. 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. Right now, Manulife's payout ratio is 41%, which means it paid out 41% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, MFC expects solid earnings growth. The Zacks Consensus Estimate for 2024 is $2.71 per share, which represents a year-over-year growth rate of 5.45%.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. 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 must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, MFC 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 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 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.
Manulife Financial in Focus
Headquartered in Toronto, Manulife Financial (MFC - Free Report) is a Finance stock that has seen a price change of 4.39% so far this year. The financial services company is currently shelling out a dividend of $0.3 per share, with a dividend yield of 5.16%. This compares to the Insurance - Life Insurance industry's yield of 0.69% and the S&P 500's yield of 1.61%.
Taking a look at the company's dividend growth, its current annualized dividend of $1.19 is up 9.9% from last year. Manulife Financial has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 9.63%. 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. Right now, Manulife's payout ratio is 41%, which means it paid out 41% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, MFC expects solid earnings growth. The Zacks Consensus Estimate for 2024 is $2.71 per share, which represents a year-over-year growth rate of 5.45%.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. 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 must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, MFC 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).