Why Silvercrest (SAMG) is a Top Dividend Stock for Your Portfolio
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.
Silvercrest in Focus
Based in New York, Silvercrest (SAMG) is in the Finance sector, and so far this year, shares have seen a price change of 31.27%. The investment company is currently shelling out a dividend of $0.17 per share, with a dividend yield of 3.02%. This compares to the Financial - Investment Management industry's yield of 1.91% and the S&P 500's yield of 1.42%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.68 is up 3% from last year. In the past five-year period, Silvercrest has increased its dividend 4 times on a year-over-year basis for an average annual increase of 7.36%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Right now, Silvercrest's payout ratio is 36%, which means it paid out 36% of its trailing 12-month EPS as dividend.
SAMG is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2022 is $1.91 per share, representing a year-over-year earnings growth rate of 1.06%.
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. However, not all companies offer 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. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, SAMG is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).
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Silvercrest Asset Management Group Inc. (SAMG) : Free Stock Analysis Report
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