Newell Brands Inc (NYSE:NWL): Dividend Is Coming In 3 Days, Should You Buy?

Have you been keeping an eye on Newell Brands Inc’s (NYSE:NWL) upcoming dividend of $0.23 per share payable on the 15 June 2018? Then you only have 3 days left before the stock starts trading ex-dividend on the 30 May 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I take a deeper dive into Newell Brands’s latest financial data to analyse its dividend attributes. Check out our latest analysis for Newell Brands

5 checks you should do on a dividend stock

Whenever I am looking at a potential dividend stock investment, I always check these five metrics:

• Does it pay an annual yield higher than 75% of dividend payers?

• Does it consistently pay out dividends without missing a payment of significantly cutting payout?

• Has the amount of dividend per share grown over the past?

• Does earnings amply cover its dividend payments?

• Will it be able to continue to payout at the current rate in the future?

NYSE:NWL Historical Dividend Yield May 26th 18

How well does Newell Brands fit our criteria?

The current trailing twelve-month payout ratio for the stock is 20.71%, which means that the dividend is covered by earnings. In the near future, analysts are predicting a higher payout ratio of 32.55%, leading to a dividend yield of around 3.78%. However, EPS is forecasted to fall to $2.22 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income. If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. Although NWL’s per share payments have increased in the past 10 years, it has not been a completely smooth ride. Shareholders would have seen a few years of reduced payments in this time. In terms of its peers, Newell Brands generates a yield of 3.64%, which is high for Consumer Durables stocks but still below the market’s top dividend payers.

Next Steps:

With these dividend metrics in mind, I definitely rank Newell Brands as a strong income stock, and is worth further research for anyone who considers dividends an important part of their portfolio strategy. Given that 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. There are three important factors you should further research:

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

2. Valuation: What is NWL 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 NWL 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.