There is a lot to be liked about A Schulman Inc (NASDAQ:SHLM) as an income stock, over the past 10 years it has returned an average of 3.00% per year. The company is currently worth US$1.31b, and now yields roughly 1.85%. Should it have a place in your portfolio? Let’s take a look at A. Schulman in more detail. View out our latest analysis for A. Schulman
Here’s how I find good dividend stocks
If you are a dividend investor, you should always assess these five key metrics:
- Is it paying an annual yield above 75% of dividend payers?
- Has it paid dividend every year without dramatically reducing payout in the past?
- Has dividend per share risen in the past couple of years?
- Is is able to pay the current rate of dividends from its earnings?
- Will it have the ability to keep paying its dividends going forward?
Does A. Schulman pass our checks?
The current trailing twelve-month payout ratio for the stock is 64.13%, which means that the dividend is covered by earnings. In the near future, analysts are predicting lower payout ratio of 22.96%, leading to a dividend yield of 1.86%. However, EPS should increase to $2.3, 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 SHLM it has increased its DPS from $0.60 to $0.82 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 SHLM a true dividend rockstar.
Compared to its peers, A. Schulman produces a yield of 1.85%, which is on the low-side for Chemicals stocks.
Considering the dividend attributes we analyzed above, A. Schulman 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. Below, I’ve compiled three key factors you should look at:
- Future Outlook: What are well-informed industry analysts predicting for SHLM’s future growth? Take a look at our free research report of analyst consensus for SHLM’s outlook.
- Valuation: What is SHLM 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 SHLM 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.