Over the past 10 years Innophos Holdings Inc (NASDAQ:IPHS) has grown its dividend payouts from $0.68 to $1.92. With a market cap of $906.88M, Innophos Holdings pays out 86.79% of its earnings, leading to a 4.13% yield. Let me elaborate on you why the stock stands out for income investors like myself. Check out our latest analysis for Innophos Holdings
What Is A Dividend Rock Star?
It is a stock that pays a stable and consistent dividend, having done so reliably for the past decade with the expectation of this continuing into the future. 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 dividend per share amount has increased over the past It can afford to pay the current rate of dividends from its earnings It has the ability to keep paying its dividends going forward
High Yield And Dependable
Innophos Holdings’s dividend yield stands at 4.13%, which is high for Chemicals stocks. But the real reason Innophos 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. In the case of IPHS it has increased its DPS from $0.68 to $1.92 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 current trailing twelve-month payout ratio for the stock is 86.79%, which means that the dividend is covered by earnings. In the near future, analysts are predicting lower payout ratio of 59.48%, leading to a dividend yield of around 4.13%. However, EPS should increase to $2.66, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment.
There aren’t many other stocks out there with the same track record as Innophos 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 essential aspects you should further examine:
- 1. Future Outlook: What are well-informed industry analysts predicting for IPHS’s future growth? Take a look at our free research report of analyst consensus for IPHS’s outlook.
- 2. Valuation: What is IPHS 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 IPHS is currently mispriced by the market.
- 3. Other Dividend Rockstars: Are there strong dividend payers with better 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.