How Does Ackermans & Van Haaren NV (EBR:ACKB) Fare As A Dividend Stock?
A large part of investment returns can be generated by dividend-paying stock given their role in compounding returns over time. Historically, Ackermans & Van Haaren NV (EBR:ACKB) has been paying a dividend to shareholders. Today it yields 1.7%. Let’s dig deeper into whether Ackermans & Van Haaren should have a place in your portfolio.
See our latest analysis for Ackermans & Van Haaren
How I analyze a dividend stock
If you are a dividend investor, you should always assess these five key metrics:
Is it the top 25% annual dividend yield payer?
Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
Has the amount of dividend per share grown over the past?
Can it afford to pay the current rate of dividends from its earnings?
Will it be able to continue to payout at the current rate in the future?
Does Ackermans & Van Haaren pass our checks?
Ackermans & Van Haaren has a trailing twelve-month payout ratio of 26%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting a payout ratio of 27% which, assuming the share price stays the same, leads to a dividend yield of around 2.0%. In addition to this, EPS should increase to €9.5.
When assessing the forecast sustainability of a dividend it is also worth considering the cash flow of the business. Cash flow is important because companies with strong cash flow can usually sustain higher payout ratios.
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 ACKB it has increased its DPS from €1.39 to €2.2 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. This is an impressive feat, which makes ACKB a true dividend rockstar.
Compared to its peers, Ackermans & Van Haaren produces a yield of 1.7%, which is on the low-side for Diversified Financial stocks.
Next Steps:
Keeping in mind the dividend characteristics above, Ackermans & Van Haaren is definitely worth considering for investors 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. I’ve put together three important factors you should further research:
Future Outlook: What are well-informed industry analysts predicting for ACKB’s future growth? Take a look at our free research report of analyst consensus for ACKB’s outlook.
Valuation: What is ACKB 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 ACKB 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
