If you are interested in cashing in on ATCO Ltd’s (TSX:ACO.X) upcoming dividend of CA$0.33 per share, you only have 3 days left to buy the shares before its ex-dividend date, 07 December 2017, in time for dividends payable on the 31 December 2017. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine ACO.X’s latest financial data to analyse its dividend characteristics. View our latest analysis for ATCO
5 questions I ask before picking a dividend stock
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
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Does it pay an annual yield higher than 75% of dividend payers?
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Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?
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Has it increased its dividend per share amount over the past?
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Can it afford to pay the current rate of dividends from its earnings?
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Will it have the ability to keep paying its dividends going forward?
How does ATCO fare?
The current payout ratio for the stock is 49.81%, which means that the dividend is covered by earnings. Going forward, analysts expect ACO.X’s payout to remain around the same level at 48.98% of its earnings, which leads to a dividend yield of 3.19%. Moreover, EPS should increase to CA$2.95. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. In the case of ACO.X it has increased its DPS from CA$0.44 to CA$1.31 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. This is an impressive feat, which makes ACO.X a true dividend rockstar. Compared to its peers, ACO.X generates a yield of 2.87%, which is on the low-side for multi-utilities stocks.
What this means for you:
Are you a shareholder? Investors of ATCO can continue to expect strong dividends from the stock moving forward. With its favorable dividend characteristics, ACO.X is one worth keeping around in your income portfolio. But, depending on your current holdings, it may be valuable exploring other dividend stocks to enhance your diversification, or even look at high-growth stocks to complement your steady income stocks. I suggest continuing your research by checking out my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.
Are you a potential investor? Taking into account the dividend metrics, ATCO ticks most of the boxes as a strong dividend investment, putting it in my list of top dividend payers. As with all investments, 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. Whether or not you like ACO.X as a dividend stock, it’s still worth checking the price tag. Can you buy ACO.X for a great price? Take a look at our latest free analysis to find out!
To help readers see pass 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.