If you are interested in cashing in on Ingredion Incorporated’s (NYSE:INGR) upcoming dividend of US$0.60 per share, you only have 2 days left to buy the shares before its ex-dividend date, 29 June 2018, in time for dividends payable on the 25 July 2018. What does this mean for current shareholders and potential investors? Below, I will explain how holding Ingredion can impact your portfolio income stream, by analysing the stock’s most recent financial data and dividend attributes. View out our latest analysis for Ingredion
5 questions to ask before buying a dividend stock
When researching a dividend stock, I always follow the following screening criteria:
- 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 dividend per share amount increased over the past?
- Can it afford to pay the current rate of dividends from its earnings?
- Will the company be able to keep paying dividend based on the future earnings growth?
How well does Ingredion fit our criteria?
The current trailing twelve-month payout ratio for the stock is 30.96%, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect INGR’s payout to remain around the same level at 28.32% of its earnings, which leads to a dividend yield of 2.32%. Furthermore, EPS should increase to $8.03.
If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. INGR has increased its DPS from $0.56 to $2.4 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.
Compared to its peers, Ingredion produces a yield of 2.19%, which is on the low-side for Food stocks.
Considering the dividend attributes we analyzed above, Ingredion 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. Below, I’ve compiled three relevant factors you should further research:
- Future Outlook: What are well-informed industry analysts predicting for INGR’s future growth? Take a look at our free research report of analyst consensus for INGR’s outlook.
- Valuation: What is INGR 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 INGR is currently mispriced by the market.
- 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.