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Why Invesco (IVZ) is a Great Dividend Stock Right Now
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All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. 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.
Invesco in Focus
Invesco (IVZ - Free Report) is headquartered in Atlanta, and is in the Finance sector. The stock has seen a price change of -1.97% since the start of the year. The investment management company is currently shelling out a dividend of $0.31 per share, with a dividend yield of 7.56%. This compares to the Financial - Investment Management industry's yield of 2.79% and the S&P 500's yield of 1.91%.
In terms of dividend growth, the company's current annualized dividend of $1.24 is up 4.2% from last year. Over the last 5 years, Invesco has increased its dividend 5 times on a year-over-year basis for an average annual increase of 4.26%. 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. Right now, Invesco's payout ratio is 54%, which means it paid out 54% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, IVZ expects solid earnings growth. The Zacks Consensus Estimate for 2019 is $2.44 per share, which represents a year-over-year growth rate of 0.41%.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. However, not all companies offer 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. 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, IVZ 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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Why Invesco (IVZ) is a Great Dividend Stock Right Now
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. 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.
Invesco in Focus
Invesco (IVZ - Free Report) is headquartered in Atlanta, and is in the Finance sector. The stock has seen a price change of -1.97% since the start of the year. The investment management company is currently shelling out a dividend of $0.31 per share, with a dividend yield of 7.56%. This compares to the Financial - Investment Management industry's yield of 2.79% and the S&P 500's yield of 1.91%.
In terms of dividend growth, the company's current annualized dividend of $1.24 is up 4.2% from last year. Over the last 5 years, Invesco has increased its dividend 5 times on a year-over-year basis for an average annual increase of 4.26%. 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. Right now, Invesco's payout ratio is 54%, which means it paid out 54% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, IVZ expects solid earnings growth. The Zacks Consensus Estimate for 2019 is $2.44 per share, which represents a year-over-year growth rate of 0.41%.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. However, not all companies offer 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. 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, IVZ 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).