Are You An Income Investor? Don’t Miss Out On Applied Materials Inc (NASDAQ:AMAT)

Applied Materials Inc (NASDAQ:AMAT) has pleased shareholders over the past 10 years, paying out an average dividend of 2.00% annually. The company currently pays out a dividend yield of 1.57% to shareholders, making it a relatively attractive dividend stock. Let’s dig deeper into whether Applied Materials should have a place in your portfolio. See our latest analysis for Applied Materials

5 questions I ask before picking a dividend stock

If you are a dividend investor, you should always assess these five key metrics:

• Is it the top 25% annual dividend yield payer?

• Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?

• Has it increased its dividend per share amount over the past?

• Does earnings amply cover its dividend payments?

• Will it have the ability to keep paying its dividends going forward?

NasdaqGS:AMAT Historical Dividend Yield May 28th 18

How well does Applied Materials fit our criteria?

Applied Materials has a trailing twelve-month payout ratio of 16.63%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting a payout ratio of 16.72%, leading to a dividend yield of around 1.47%. In addition to this, EPS should increase to $3.98. 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 AMAT it has increased its DPS from $0.24 to $0.8 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. This is an impressive feat, which makes AMAT a true dividend rockstar. Relative to peers, Applied Materials has a yield of 1.57%, which is on the low-side for Semiconductor stocks.

Next Steps:

Considering the dividend attributes we analyzed above, Applied Materials is definitely worth keeping an eye on for someone looking to build a dedicated income portfolio. Given that 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. I’ve put together three essential factors you should look at:

1. Future Outlook: What are well-informed industry analysts predicting for AMAT’s future growth? Take a look at our free research report of analyst consensus for AMAT’s outlook.

2. Valuation: What is AMAT 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 AMAT is currently mispriced by the market.

3. Other Dividend Rockstars: Are there better dividend payers with stronger 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.