Yahoo Finance What Makes Brewin Dolphin Holdings PLC (LON:BRW) A Great Dividend Stock?
Brewin Dolphin Holdings PLC (LON:BRW) is a true Dividend Rock Star. Its yield of 5.3% makes it one of the market’s top dividend payer. In the past ten years, Brewin Dolphin Holdings has also grown its dividend from £0.071 to £0.16. Below, I have outlined more attractive dividend aspects for Brewin Dolphin Holdings for income investors who may be interested in new dividend stocks for their portfolio.
View our latest analysis for Brewin Dolphin Holdings
What Is A Dividend Rock Star?
It is a stock that pays a reliable and steady dividend over the past decade, at a rate that is competitive relative to the other dividend-paying companies on the market. More specifically:
Its annual yield is among the top 25% 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
Brewin Dolphin Holdings’s yield sits at 5.3%, which is high for Capital Markets stocks. But the real reason Brewin Dolphin Holdings stands out is because it has a proven track record of continuously paying out this level of dividends, from earnings, to shareholders and can be expected to continue paying in the future. This is a highly desirable trait for a stock holding if you’re investor who wants a robust cash inflow from your portfolio over a long period of time.
Reliablity is an important factor for dividend stocks, particularly for income investors who want a strong track record of payment and a positive outlook for future payout. BRW has increased its DPS from £0.071 to £0.16 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. These are all positive signs of a great, reliable dividend stock.
The company currently pays out 84% of its earnings as a dividend, according to its trailing twelve-month data, which means that the dividend is covered by earnings. In the near future, analysts are predicting a payout ratio of 78% which, assuming the share price stays the same, leads to a dividend yield of around 5.5%. Moreover, EPS is forecasted to fall to £0.18 in the upcoming year.
If you want to dive deeper into the sustainability of a certain payout ratio, you may wish to consider the cash flow of the business. Cash flow is important because companies with strong cash flow can usually sustain higher payout ratios.
Next Steps:
There aren’t many other stocks out there with the same track record as Brewin Dolphin Holdings, so I would certainly recommend further examining the stock if its dividend characteristics appeal to you. However, given this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. Below, I’ve compiled three key factors you should further research:
Future Outlook: What are well-informed industry analysts predicting for BRW’s future growth? Take a look at our free research report of analyst consensus for BRW’s outlook.
Valuation: What is BRW 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 BRW 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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
