Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
Cash flow can come from bond interest, interest from other types of investments, and of course, 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.
Herman Miller in Focus
Based in Zeeland, Herman Miller is in the Business Services sector, and so far this year, shares have seen a price change of -14.46%. The furniture maker is currently shelling out a dividend of $0.2 per share, with a dividend yield of 2.31%. This compares to the Business - Office Products industry's yield of 2.76% and the S&P 500's yield of 1.89%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.79 is up 9.7% from last year. Herman Miller has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 8.26%. 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, Herman Miller's payout ratio is 33%, which means it paid out 33% of its trailing 12-month EPS as dividend.
MLHR is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2018 is $2.70 per share, which represents a year-over-year growth rate of 17.39%.
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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, MLHR 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? Herman Miller (MLHR) 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. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
Cash flow can come from bond interest, interest from other types of investments, and of course, 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.
Herman Miller in Focus
Based in Zeeland, Herman Miller is in the Business Services sector, and so far this year, shares have seen a price change of -14.46%. The furniture maker is currently shelling out a dividend of $0.2 per share, with a dividend yield of 2.31%. This compares to the Business - Office Products industry's yield of 2.76% and the S&P 500's yield of 1.89%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.79 is up 9.7% from last year. Herman Miller has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 8.26%. 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, Herman Miller's payout ratio is 33%, which means it paid out 33% of its trailing 12-month EPS as dividend.
MLHR is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2018 is $2.70 per share, which represents a year-over-year growth rate of 17.39%.
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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, MLHR 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).