Thor Industries Inc (NYSE:THO): 4 Days To Buy Before The Ex-Dividend Date
If you are interested in cashing in on Thor Industries Inc’s (NYSE:THO) upcoming dividend of US$0.39 per share, you only have 4 days left to buy the shares before its ex-dividend date, 24 October 2018, in time for dividends payable on the 09 November 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Thor Industries’s latest financial data to analyse its dividend characteristics.
Check out our latest analysis for Thor Industries
5 questions I ask before picking a dividend stock
Whenever I am looking at a potential dividend stock investment, I always check these five metrics:
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 dividend per share risen in the past couple of years?
Is its earnings sufficient to payout dividend at the current rate?
Will it have the ability to keep paying its dividends going forward?
Does Thor Industries pass our checks?
Thor Industries has a trailing twelve-month payout ratio of 18%, which means that the dividend is covered by earnings. Going forward, analysts expect THO’s payout to remain around the same level at 16% of its earnings, which leads to a dividend yield of 2.0%. Moreover, EPS should increase to $8.62.
When considering the sustainability of dividends, it is also worth checking the cash flow of a company. A business with strong cash flow can sustain a higher divided payout ratio than a company with weak cash flow.
If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. Not only have dividend payouts from Thor Industries fallen over the past 10 years, it has also been highly volatile during this time, with drops of over 25% in some years. These characteristics do not bode well for income investors seeking reliable stream of dividends.
Compared to its peers, Thor Industries generates a yield of 2.0%, which is on the low-side for Auto stocks.
Next Steps:
If you are building an income portfolio, then Thor Industries is a complicated choice since it has some positive aspects as well as negative ones. 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 fundamental factors you should look at:
Future Outlook: What are well-informed industry analysts predicting for THO’s future growth? Take a look at our free research report of analyst consensus for THO’s outlook.
Valuation: What is THO 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 THO 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 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.
