U.S. Markets open in 2 hrs 31 mins
  • S&P Futures

    3,907.00
    -15.50 (-0.40%)
     
  • Dow Futures

    31,904.00
    -12.00 (-0.04%)
     
  • Nasdaq Futures

    13,153.25
    -148.75 (-1.12%)
     
  • Russell 2000 Futures

    2,288.60
    +3.50 (+0.15%)
     
  • Crude Oil

    63.28
    +0.06 (+0.09%)
     
  • Gold

    1,781.40
    -16.50 (-0.92%)
     
  • Silver

    27.88
    +0.02 (+0.08%)
     
  • EUR/USD

    1.2229
    +0.0061 (+0.5014%)
     
  • 10-Yr Bond

    1.3890
    0.0000 (0.00%)
     
  • Vix

    22.92
    -0.19 (-0.82%)
     
  • GBP/USD

    1.4133
    -0.0008 (-0.0594%)
     
  • USD/JPY

    106.1300
    +0.2480 (+0.2342%)
     
  • BTC-USD

    50,238.36
    -150.08 (-0.30%)
     
  • CMC Crypto 200

    1,004.56
    +9.90 (+0.99%)
     
  • FTSE 100

    6,678.76
    +19.79 (+0.30%)
     
  • Nikkei 225

    30,168.27
    +496.57 (+1.67%)
     

Be Sure To Check Out Jefferies Financial Group Inc. (NYSE:JEF) Before It Goes Ex-Dividend

  • Oops!
    Something went wrong.
    Please try again later.
Simply Wall St
·3 min read
  • Oops!
    Something went wrong.
    Please try again later.

It looks like Jefferies Financial Group Inc. (NYSE:JEF) is about to go ex-dividend in the next four days. Investors can purchase shares before the 11th of February in order to be eligible for this dividend, which will be paid on the 26th of February.

Jefferies Financial Group's upcoming dividend is US$0.20 a share, following on from the last 12 months, when the company distributed a total of US$0.80 per share to shareholders. Based on the last year's worth of payments, Jefferies Financial Group has a trailing yield of 3.1% on the current stock price of $25.51. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. So we need to investigate whether Jefferies Financial Group can afford its dividend, and if the dividend could grow.

Check out our latest analysis for Jefferies Financial Group

If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Jefferies Financial Group has a low and conservative payout ratio of just 22% of its income after tax.

Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.

Click here to see the company's payout ratio, plus analyst estimates of its future dividends.

historic-dividend
historic-dividend

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. It's encouraging to see Jefferies Financial Group has grown its earnings rapidly, up 30% a year for the past five years.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Since the start of our data, 10 years ago, Jefferies Financial Group has lifted its dividend by approximately 12% a year on average. It's exciting to see that both earnings and dividends per share have grown rapidly over the past few years.

Final Takeaway

Has Jefferies Financial Group got what it takes to maintain its dividend payments? When companies are growing rapidly and retaining a majority of the profits within the business, it's usually a sign that reinvesting earnings creates more value than paying dividends to shareholders. Perhaps even more importantly - this can sometimes signal management is focused on the long term future of the business. Jefferies Financial Group ticks a lot of boxes for us from a dividend perspective, and we think these characteristics should mark the company as deserving of further attention.

So while Jefferies Financial Group looks good from a dividend perspective, it's always worthwhile being up to date with the risks involved in this stock. To that end, you should learn about the 4 warning signs we've spotted with Jefferies Financial Group (including 2 which don't sit too well with us).

If you're in the market for dividend stocks, we recommend checking our list of top dividend stocks with a greater than 2% yield and an upcoming dividend.

This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.