Why Allianz SE (ALIZY) is a Great Dividend Stock Right Now
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. However, 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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Allianz SE in Focus
Based in Munich, Allianz SE (ALIZY) is in the Finance sector, and so far this year, shares have seen a price change of 10.16%. The company is paying out a dividend of $0.87 per share at the moment, with a dividend yield of 3.68% compared to the Insurance - Multi line industry's yield of 2.3% and the S&P 500's yield of 1.59%.
Looking at dividend growth, the company's current annualized dividend of $0.87 is up 10.8% from last year. Allianz SE has increased its dividend 3 times on a year-over-year basis over the last 5 years for an average annual increase of 3.41%. 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. Allianz SE's current payout ratio is 37%. This means it paid out 37% of its trailing 12-month EPS as dividend.
ALIZY is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2023 is $2.62 per share, which represents a year-over-year growth rate of 53.22%.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. But, not every company offers 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. With that in mind, ALIZY presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).
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Allianz SE (ALIZY) : Free Stock Analysis Report
