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This is Why Atlantic Union (AUB) is a Great Dividend Stock
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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. 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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Atlantic Union in Focus
Headquartered in Richmond, Atlantic Union (AUB - Free Report) is a Finance stock that has seen a price change of -5.19% so far this year. Currently paying a dividend of $0.25 per share, the company has a dividend yield of 2.81%. In comparison, the Banks - Northeast industry's yield is 1.78%, while the S&P 500's yield is 1.75%.
Taking a look at the company's dividend growth, its current annualized dividend of $1 is up 4.2% from last year. Over the last 5 years, Atlantic Union has increased its dividend 5 times on a year-over-year basis for an average annual increase of 8.85%. 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. Atlantic Union's current payout ratio is 36%, meaning it paid out 36% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for AUB for this fiscal year. The Zacks Consensus Estimate for 2020 is $2.81 per share, with earnings expected to increase 2.18% from the year ago period.
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. But, not every company offers 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. With that in mind, AUB 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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This is Why Atlantic Union (AUB) is a Great Dividend Stock
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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Atlantic Union in Focus
Headquartered in Richmond, Atlantic Union (AUB - Free Report) is a Finance stock that has seen a price change of -5.19% so far this year. Currently paying a dividend of $0.25 per share, the company has a dividend yield of 2.81%. In comparison, the Banks - Northeast industry's yield is 1.78%, while the S&P 500's yield is 1.75%.
Taking a look at the company's dividend growth, its current annualized dividend of $1 is up 4.2% from last year. Over the last 5 years, Atlantic Union has increased its dividend 5 times on a year-over-year basis for an average annual increase of 8.85%. 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. Atlantic Union's current payout ratio is 36%, meaning it paid out 36% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for AUB for this fiscal year. The Zacks Consensus Estimate for 2020 is $2.81 per share, with earnings expected to increase 2.18% from the year ago period.
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. But, not every company offers 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. With that in mind, AUB 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).