Back to top

Image: Bigstock

Woori Bank (WF) Could Be a Great Choice

Read MoreHide Full Article

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.

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.

Woori Bank (WF - Free Report) is headquartered in Seoul, and is in the Finance sector. The stock has seen a price change of 70.24% since the start of the year. The company is currently shelling out a dividend of $0.34 per share, with a dividend yield of 2.57%. This compares to the Banks - Foreign industry's yield of 3.2% and the S&P 500's yield of 1.48%.

Looking at dividend growth, the company's current annualized dividend of $1.37 is up 50.2% from last year. Over the last 5 years, Woori Bank has increased its dividend 3 times on a year-over-year basis for an average annual increase of 11.20%. 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. Woori Bank's current payout ratio is 17%, meaning it paid out 17% of its trailing 12-month EPS as dividend.

Earnings growth looks solid for WF for this fiscal year. The Zacks Consensus Estimate for 2025 is $8.74 per share, with earnings expected to increase 0.58% from the year ago period.

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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. That said, they can take comfort from the fact that WF is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Woori Bank (WF) - free report >>

Published in