3 Days Left To Cash In On Lowe’s Companies Inc (NYSE:LOW) Dividend, Should You Buy?

If you are interested in cashing in on Lowe’s Companies Inc’s (NYSE:LOW) upcoming dividend of $0.41 per share, you only have 3 days left to buy the shares before its ex-dividend date, 24 April 2018, in time for dividends payable on the 09 May 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Lowe’s Companies’s latest financial data to analyse its dividend characteristics. Check out our latest analysis for Lowe’s Companies

5 checks you should use to assess 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 it increased its dividend per share amount over the past?

• Does earnings amply cover its dividend payments?

• Based on future earnings growth, will it be able to continue to payout dividend at the current rate?

NYSE:LOW Historical Dividend Yield Apr 20th 18

How does Lowe’s Companies fare?

Lowe’s Companies has a trailing twelve-month payout ratio of 38.58%, which means that the dividend is covered by earnings. In the near future, analysts are predicting lower payout ratio of 31.18%, leading to a dividend yield of around 2.52%. However, EPS should increase to $5.44, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. 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. In the case of LOW it has increased its DPS from $0.32 to $1.64 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. This is an impressive feat, which makes LOW a true dividend rockstar. Compared to its peers, Lowe’s Companies generates a yield of 1.93%, which is on the low-side for Specialty Retail stocks.

Next Steps:

Considering the dividend attributes we analyzed above, Lowe’s Companies is definitely worth keeping an eye on for someone looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. There are three important factors you should look at:

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

2. Valuation: What is LOW 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 LOW 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.