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Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. 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 make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Based in Los Angeles, Cathay General (CATY - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of 16.57%. The holding company for Cathay Bank is currently shelling out a dividend of $0.38 per share, with a dividend yield of 2.69%. This compares to the Banks - West industry's yield of 2.71% and the S&P 500's yield of 1.39%.
Looking at dividend growth, the company's current annualized dividend of $1.52 is up 11.8% from last year. Over the last 5 years, Cathay General has increased its dividend 1 times on a year-over-year basis for an average annual increase of 2.11%. 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. Cathay's current payout ratio is 31%, meaning it paid out 31% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, CATY expects solid earnings growth. The Zacks Consensus Estimate for 2026 is $5.40 per share, with earnings expected to increase 18.94% from the year ago period.
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.
For instance, it's a rare occurrence when a tech start-up or big growth business offers its shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. Income investors have to be mindful 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 CATY 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?
Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. 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 make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Based in Los Angeles, Cathay General (CATY - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of 16.57%. The holding company for Cathay Bank is currently shelling out a dividend of $0.38 per share, with a dividend yield of 2.69%. This compares to the Banks - West industry's yield of 2.71% and the S&P 500's yield of 1.39%.
Looking at dividend growth, the company's current annualized dividend of $1.52 is up 11.8% from last year. Over the last 5 years, Cathay General has increased its dividend 1 times on a year-over-year basis for an average annual increase of 2.11%. 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. Cathay's current payout ratio is 31%, meaning it paid out 31% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, CATY expects solid earnings growth. The Zacks Consensus Estimate for 2026 is $5.40 per share, with earnings expected to increase 18.94% from the year ago period.
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.
For instance, it's a rare occurrence when a tech start-up or big growth business offers its shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. Income investors have to be mindful 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 CATY is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).