Only 3 Days Left To Cash In On South Jersey Industries Inc (SJI) Dividend, Should Investors Buy?
Investors who want to cash in on South Jersey Industries Inc’s (NYSE:SJI) upcoming dividend of $0.28 per share have only 3 days left to buy the shares before its ex-dividend date, 08 December 2017, in time for dividends payable on the 27 December 2017. Should you diversify into SJI 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. View our latest analysis for South Jersey Industries
How I analyze a dividend stock
If you are a dividend investor, you should always assess these five key metrics:
Does it pay an annual yield higher than 75% of dividend payers?
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 have the ability to keep paying its dividends going forward?
How well does South Jersey Industries fit our criteria?
SJI currently pays out twice what it is earning, meaning that the dividend is predominantly funded by retained earnings. In the near future, analysts are predicting a more sensible payout ratio of 69.56%, leading to a dividend yield of 3.35%. In addition to this, EPS should increase to $1.12, 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 SJI it has increased its DPS from $0.54 to $1.09 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 SJI a true dividend rockstar. Relative to peers, SJI generates a yield of 3.26%, which is high for gas utilities stocks.
What this means for you:
Are you a shareholder? With South Jersey Industries producing strong dividend income for your portfolio over the past few years, you can take comfort in knowing that this stock will still continue to be a robust dividend generator moving forward. However, depending on your portfolio composition, it may be valuable exploring other dividend stocks to enhance your diversification, or even look at high-growth stocks to supplement your steady income stocks. I suggest continuing your research by exploring my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.
Are you a potential investor? Taking into account the dividend metrics, South Jersey Industries ticks most of the boxes as a strong dividend investment, putting it in my list of top dividend payers. As always, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. No matter how much of a cash cow South Jersey Industries is, it is not worth an infinite price. Can you still benefit from a mispricing of the stock? Dig deeper in our latest free analysis to find out!
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.
