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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. However, 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.
Based in Olympia, Heritage Financial (HFWA - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of -1.27%. Currently paying a dividend of $0.24 per share, the company has a dividend yield of 3.97%. In comparison, the Financial - Savings and Loan industry's yield is 2.75%, while the S&P 500's yield is 1.49%.
Looking at dividend growth, the company's current annualized dividend of $0.96 is up 4.3% from last year. Over the last 5 years, Heritage Financial has increased its dividend 4 times on a year-over-year basis for an average annual increase of 4.17%. 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. Heritage Financial's current payout ratio is 52%, meaning it paid out 52% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for HFWA for this fiscal year. The Zacks Consensus Estimate for 2025 is $2.11 per share, which represents a year-over-year growth rate of 14.05%.
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. 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 HFWA 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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Heritage Financial (HFWA) 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. However, 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.
Based in Olympia, Heritage Financial (HFWA - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of -1.27%. Currently paying a dividend of $0.24 per share, the company has a dividend yield of 3.97%. In comparison, the Financial - Savings and Loan industry's yield is 2.75%, while the S&P 500's yield is 1.49%.
Looking at dividend growth, the company's current annualized dividend of $0.96 is up 4.3% from last year. Over the last 5 years, Heritage Financial has increased its dividend 4 times on a year-over-year basis for an average annual increase of 4.17%. 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. Heritage Financial's current payout ratio is 52%, meaning it paid out 52% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for HFWA for this fiscal year. The Zacks Consensus Estimate for 2025 is $2.11 per share, which represents a year-over-year growth rate of 14.05%.
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. 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 HFWA is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).