Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. 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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
PolyOne in Focus
Based in Avon Lake, PolyOne is in the Basic Materials sector, and so far this year, shares have seen a price change of -15.66%. The maker of resins used in plastic pipe and other products is currently shelling out a dividend of $0.2 per share, with a dividend yield of 2.61%. This compares to the Chemical - Plastic industry's yield of 1.66% and the S&P 500's yield of 1.78%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.81 is up 2.9% from last year. PolyOne has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 17.83%. Any future dividend growth will depend on both earnings growth and the company's payout ratio; a payout ratio is the proportion of a firm's annual earnings per share that it pays out as a dividend. PolyOne's current payout ratio is 38%. This means it paid out 38% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, POL expects solid earnings growth. The Zacks Consensus Estimate for 2020 is $1.83 per share, representing a year-over-year earnings growth rate of 8.28%.
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.
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 POL 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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This is Why PolyOne (POL) is a Great Dividend Stock
Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. 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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
PolyOne in Focus
Based in Avon Lake, PolyOne is in the Basic Materials sector, and so far this year, shares have seen a price change of -15.66%. The maker of resins used in plastic pipe and other products is currently shelling out a dividend of $0.2 per share, with a dividend yield of 2.61%. This compares to the Chemical - Plastic industry's yield of 1.66% and the S&P 500's yield of 1.78%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.81 is up 2.9% from last year. PolyOne has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 17.83%. Any future dividend growth will depend on both earnings growth and the company's payout ratio; a payout ratio is the proportion of a firm's annual earnings per share that it pays out as a dividend. PolyOne's current payout ratio is 38%. This means it paid out 38% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, POL expects solid earnings growth. The Zacks Consensus Estimate for 2020 is $1.83 per share, representing a year-over-year earnings growth rate of 8.28%.
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.
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 POL is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).