Important news for shareholders and potential investors in PolyOne Corporation (NYSE:POL): The dividend payment of $0.18 per share will be distributed into shareholder on 06 July 2018, and the stock will begin trading ex-dividend at an earlier date, 14 June 2018. What does this mean for current shareholders and potential investors? Below, I will explain how holding PolyOne can impact your portfolio income stream, by analysing the stock’s most recent financial data and dividend attributes. Check out our latest analysis for PolyOne
5 questions to ask before buying a dividend stock
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
- 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 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?
Does PolyOne pass our checks?
The current trailing twelve-month payout ratio for the stock is 29.07%, which means that the dividend is covered by earnings. Going forward, analysts expect POL’s payout to remain around the same level at 28.47% of its earnings, which leads to a dividend yield of around 1.91%. In addition to this, EPS should increase to $2.56. 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. Unfortunately, it is really too early to view PolyOne as a dividend investment. It has only been consistently paying dividends for 7 years, however, standard practice for reliable payers is to look for a 10-year minimum track record. Relative to peers, PolyOne generates a yield of 1.60%, which is on the low-side for Chemicals stocks.
Whilst there are few things you may like about PolyOne from a dividend stock perspective, the truth is that overall it probably is not the best choice for a dividend investor. However, if you are not strictly just a dividend investor, the stock could still offer some interesting investment opportunities. 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 further examine:
- Future Outlook: What are well-informed industry analysts predicting for POL’s future growth? Take a look at our free research report of analyst consensus for POL’s outlook.
- Valuation: What is POL 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 POL is currently mispriced by the market.
- 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.