Only 3 Days Left Before Service Corporation International (SCI) Will Start Trading Ex-Dividend, Is It Worth Buying?
Important news for shareholders and potential investors in Service Corporation International (NYSE:SCI): The dividend payment of $0.15 per share will be distributed into shareholder on 29 December 2017, and the stock will begin trading ex-dividend at an earlier date, 14 December 2017. What does this mean for current shareholders and potential investors? Below, I will explain how holding SCI can impact your portfolio income stream, by analysing the stock’s most recent financial data and dividend attributes. View our latest analysis for Service International
Here’s how I find good dividend stocks
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
Is their annual yield among the top 25% of dividend payers?
Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
Has dividend per share risen in the past couple of years?
Does earnings amply cover its dividend payments?
Will the company be able to keep paying dividend based on the future earnings growth?
Does Service International pass our checks?
The company currently pays out 28.86% of its earnings as a dividend, which means that the dividend is covered by earnings. Going forward, analysts expect SCI’s payout to increase to 36.04% of its earnings, which leads to a dividend yield of 1.53%. However, EPS is forecasted to fall to $1.68 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income. 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. SCI has increased its DPS from $0.16 to $0.6 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. This is an impressive feat, which makes SCI a true dividend rockstar. In terms of its peers, Service International produces a yield of 1.59%, which is high for consumer services stocks but still below the low risk savings rate.
What this means for you:
Are you a shareholder?
Are you a shareholder? With Service International 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. But, depending on your portfolio composition, it may be beneficial exploring other income stocks to increase diversification, or even look at high-growth stocks to supplement your steady income stocks. I encourage you to continue 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? Considering the dividend attributes we analyzed above, SCI is definitely worth keeping an eye on for someone looking to build a dedicated income portfolio. I also recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. Another aspect to consider for SCI is how much it’s actually worth. Is SCI still a bargain? Check 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.
