Yahoo Finance Dividend Hunters Should Consider PayPoint plc (LON:PAY), With A 8.45% Yield
Over the past 10 years PayPoint plc (LSE:PAY) has grown its dividend payouts from £0.16 to £0.83. With a market cap of UK£666.12M, PayPoint pays out 34.60% of its earnings, leading to a 8.45% yield. Let me elaborate on you why the stock stands out for income investors like myself. See our latest analysis for PayPoint
What Is A Dividend Rock Star?
It is a stock that pays a stable and consistent dividend, having done so reliably for the past decade with the expectation of this continuing into the future. More specifically: It is paying an annual yield above 75% of dividend payers It has paid dividend every year without dramatically reducing payout in the past Its has increased its dividend per share amount over the past It is able to pay the current rate of dividends from its earnings It is able to continue to payout at the current rate in the future
High Yield And Dependable
PayPoint’s dividend yield stands at 8.45%, which is high for Commercial Services stocks. But the real reason PayPoint stands out is because it has a high chance of being able to continue to pay dividend at this level for years to come, something that is quite desirable if you are looking to create a portfolio that generates a steady stream of income.
If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. In the case of PAY it has increased its DPS from £0.16 to £0.83 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. These are all positive signs of a great, reliable dividend stock. The current trailing twelve-month payout ratio for the stock is 34.60%, which means that the dividend is covered by earnings. Going forward, analysts expect PAY’s payout to increase to 72.94% of its earnings, which leads to a dividend yield of 5.17%. However, EPS is forecasted to fall to £0.62 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income.
Next Steps:
With PayPoint producing strong dividend income for your portfolio over the past few years, you can take comfort in knowing that this stock will still continue to be a top dividend generator moving forward. However, given this is purely a dividend analysis, I recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. Below, I’ve compiled three important aspects you should look at:
Future Outlook: What are well-informed industry analysts predicting for PAY’s future growth? Take a look at our free research report of analyst consensus for PAY’s outlook.
Valuation: What is PAY worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether PAY is currently mispriced by the market.
Other Dividend Rockstars: Are there strong dividend payers with better fundamentals out there? Check out our free list of these great stocks here.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
