Only 4 Days Left Before Unitil Corporation (NYSE:UTL) Will Be Trading Ex-Dividend
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Shares of Unitil Corporation (NYSE:UTL) will begin trading ex-dividend in 4 days. To qualify for the dividend check of US$0.37 per share, investors must have owned the shares prior to 13 February 2019, which is the last day the company’s management will finalize their list of shareholders to which they will send dividend payments. Should you diversify into Unitil 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.
See our latest analysis for Unitil
How I analyze a dividend stock
If you are a dividend investor, you should always assess these five key metrics:
Is their annual yield among the top 25% of dividend payers?
Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?
Has dividend per share risen in the past couple of years?
Is is able to pay the current rate of dividends from its earnings?
Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
Does Unitil pass our checks?
The company currently pays out 66% of its earnings as a dividend, according to its trailing twelve-month data, which means that the dividend is covered by earnings. Going forward, analysts expect UTL’s payout to remain around the same level at 63% of its earnings. Assuming a constant share price, this equates to a dividend yield of 2.9%. Furthermore, EPS should increase to $2.28.
When assessing the forecast sustainability of a dividend it is also worth considering the cash flow of the business. A company with strong cash flow, relative to earnings, can sometimes sustain a high pay out ratio.
Reliablity is an important factor for dividend stocks, particularly for income investors who want a strong track record of payment and a positive outlook for future payout. UTL has increased its DPS from $1.38 to $1.48 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 UTL a true dividend rockstar.
In terms of its peers, Unitil produces a yield of 2.8%, which is on the low-side for Integrated Utilities stocks.
Next Steps:
Considering the dividend attributes we analyzed above, Unitil is definitely worth keeping an eye on for someone looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. Below, I’ve compiled three essential factors you should further research:
Future Outlook: What are well-informed industry analysts predicting for UTL’s future growth? Take a look at our free research report of analyst consensus for UTL’s outlook.
Historical Performance: What has UTL’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
Other 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
