Advertisement
Singapore markets closed
  • Straits Times Index

    3,224.01
    -27.70 (-0.85%)
     
  • Nikkei

    40,168.07
    -594.66 (-1.46%)
     
  • Hang Seng

    16,541.42
    +148.58 (+0.91%)
     
  • FTSE 100

    7,952.62
    +20.64 (+0.26%)
     
  • Bitcoin USD

    70,843.05
    +2,228.12 (+3.25%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • S&P 500

    5,256.48
    +7.99 (+0.15%)
     
  • Dow

    39,817.34
    +57.26 (+0.14%)
     
  • Nasdaq

    16,386.62
    -12.90 (-0.08%)
     
  • Gold

    2,239.70
    +27.00 (+1.22%)
     
  • Crude Oil

    82.99
    +1.64 (+2.02%)
     
  • 10-Yr Bond

    4.2060
    +0.0100 (+0.24%)
     
  • FTSE Bursa Malaysia

    1,530.60
    -7.82 (-0.51%)
     
  • Jakarta Composite Index

    7,288.81
    -21.28 (-0.29%)
     
  • PSE Index

    6,903.53
    +5.36 (+0.08%)
     

Spire (SR) is a Top Dividend Stock Right Now: Should You Buy?

Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.

Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a 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.

Spire in Focus

Headquartered in St Louis, Spire (SR) is a Utilities stock that has seen a price change of 10.73% so far this year. The natural gas distributor is paying out a dividend of $0.59 per share at the moment, with a dividend yield of 2.89% compared to the Utility - Gas Distribution industry's yield of 2.55% and the S&P 500's yield of 1.89%.

ADVERTISEMENT

Looking at dividend growth, the company's current annualized dividend of $2.37 is up 5.3% from last year. Over the last 5 years, Spire has increased its dividend 5 times on a year-over-year basis for an average annual increase of 6.67%. 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. Spire's current payout ratio is 60%, meaning it paid out 60% of its trailing 12-month EPS as dividend.

Earnings growth looks solid for SR for this fiscal year. The Zacks Consensus Estimate for 2019 is $3.74 per share, which represents a year-over-year growth rate of 0.54%.

Bottom Line

Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. It's important to keep in mind that not all companies provide a quarterly payout.

For instance, it's a rare occurrence when a tech start-up or big growth business offers their shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, SR 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).


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Spire Inc. (SR) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research