Oil-Dri Corporation of America (NYSE:ODC) Is Due To Pay A Dividend Of $0.29
Oil-Dri Corporation of America (NYSE:ODC) has announced that it will pay a dividend of $0.29 per share on the 8th of March. The dividend yield is 1.7% based on this payment, which is a little bit low compared to the other companies in the industry.
View our latest analysis for Oil-Dri Corporation of America
Oil-Dri Corporation of America's Dividend Is Well Covered By Earnings
The dividend yield is a little bit low, but sustainability of the payments is also an important part of evaluating an income stock. However, prior to this announcement, Oil-Dri Corporation of America's dividend was comfortably covered by both cash flow and earnings. This means that most of what the business earns is being used to help it grow.
If the trend of the last few years continues, EPS will grow by 40.3% over the next 12 months. If the dividend continues on this path, the payout ratio could be 19% by next year, which we think can be pretty sustainable going forward.
Oil-Dri Corporation of America Has A Solid Track Record
The company has been paying a dividend for a long time, and it has been quite stable which gives us confidence in the future dividend potential. The annual payment during the last 10 years was $0.76 in 2013, and the most recent fiscal year payment was $1.16. This implies that the company grew its distributions at a yearly rate of about 4.3% over that duration. Although we can't deny that the dividend has been remarkably stable in the past, the growth has been pretty muted.
The Dividend Looks Likely To Grow
Investors could be attracted to the stock based on the quality of its payment history. It's encouraging to see that Oil-Dri Corporation of America has been growing its earnings per share at 40% a year over the past five years. Earnings have been growing rapidly, and with a low payout ratio we think that the company could turn out to be a great dividend stock.
Oil-Dri Corporation of America Looks Like A Great Dividend Stock
Overall, we like to see the dividend staying consistent, and we think Oil-Dri Corporation of America might even raise payments in the future. Earnings are easily covering distributions, and the company is generating plenty of cash. All in all, this checks a lot of the boxes we look for when choosing an income stock.
Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. For example, we've picked out 1 warning sign for Oil-Dri Corporation of America that investors should know about before committing capital to this stock. Is Oil-Dri Corporation of America not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
