On the 11 December 2017, H&E Equipment Services Inc (NASDAQ:HEES) will be paying shareholders an upcoming dividend amount of $0.28 per share. However, investors must have bought the company’s stock before 17 November 2017 in order to qualify for the payment. That means you have only 3 days left! Should you diversify into HEES and boost your portfolio income stream? Well, keep on reading because today, I’m going to look at the latest data and analyze the stock and its dividend property in further detail. Check out our latest analysis for H&E Equipment Services
5 questions to ask before buying a dividend stock
When researching a dividend stock, I always follow the following screening criteria:
- Is their annual yield among the top 25% of dividend payers?
- Has it paid dividend every year without dramatically reducing payout in the past?
- Has it increased its dividend per share amount over the past?
- Does earnings amply cover its dividend payments?
- Will it have the ability to keep paying its dividends going forward?
How does H&E Equipment Services fare?
The company currently pays out 107.94% of its earnings as a dividend, which means that the dividend is not well-covered by its earnings. Looking forward, analysts expect HEES to pay out 36.39% of its earnings and dividends yield to be around 2.38%. Moreover, EPS should increase to $1.35. This means the company should be able to continue to payout dividends. 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. The reality is that it is too early to consider H&E Equipment Services as a dividend investment. It has only been consistently paying dividends for 3 years, however, standard practice for reliable payers is to look for a 10-year minimum track record. Compared to its peers, HEES has a yield of 3.25%, which is high for trading companies and distributors stocks.
What this means for you:
Are you a shareholder? If HEES is in your portfolio for cash-generating reasons, there may be better alternatives out there. It may be worth exploring other dividend stocks as alternatives to HEES or even look at high-growth stocks to complement your steady income stocks. I recommend continuing your research by checking out my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.
Are you a potential investor? If you are building an income portfolio, then H&E Equipment Services is a complicated choice since it has some positive aspects as well as negative ones. However, if you are not strictly just a dividend investor, HEES could still offer some interesting investment opportunities. As with all investments, 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. Take a look at our latest free fundmental analysis to explore other aspects of HEES.
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.