Silvercrest (SAMG) Could Be a Great Choice
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Silvercrest in Focus
Headquartered in New York, Silvercrest (SAMG) is a Finance stock that has seen a price change of 12.25% so far this year. The investment company is currently shelling out a dividend of $0.18 per share, with a dividend yield of 3.42%. This compares to the Financial - Investment Management industry's yield of 2.69% and the S&P 500's yield of 1.64%.
In terms of dividend growth, the company's current annualized dividend of $0.72 is up 2.9% from last year. Silvercrest has increased its dividend 4 times on a year-over-year basis over the last 5 years for an average annual increase of 5.37%. Future dividend growth will depend on earnings growth as well as payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Silvercrest's current payout ratio is 59%. This means it paid out 59% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for SAMG for this fiscal year. The Zacks Consensus Estimate for 2023 is $1.45 per share, which represents a year-over-year growth rate of 7.41%.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. It's important to keep in mind that not all companies provide a quarterly payout.
High-growth firms or tech start-ups, for example, rarely provide their shareholders a dividend, while larger, more established companies that have more secure profits are often seen as the best dividend options. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. That said, they can take comfort from the fact that SAMG is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).
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Silvercrest Asset Management Group Inc. (SAMG) : Free Stock Analysis Report
