Getting high returns from your financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor’s dream. But for investors, generating consistent cash flow from each of your liquid assets is your primary focus.
Cash flows from mortgage interest, interest from other types of funds, and of course, interest. The distribution of profits is divided among the shareholders; It is often viewed from the dividend yield, a metric that measures the dividend as a percentage of the stock’s current value. Many academic studies show that dividend accounting accounts for significant portions of long-term income, with dividend contributions exceeding a third of total income in many cases.
Equity Lifestyle Properties in Focus
Based in Chicago, Equity Living Properties (ELS) is in the financial sector, and as of this year, the share price has changed by 1.73%. The company currently pays a dividend of $0.41 per share with a dividend yield of 2.72%. In comparison, the REIT and Equity Trust – Residential industry’s yield is 3.98%, while the S&P D’s yield is 1.73%.
Looking at dividend growth, the company’s current annual dividend is up 9.1% from last year’s $1.79 dividend. Over the past five years, Equity Lifestyle Properties has increased its dividend 5 times on a year-over-year basis for an average annual growth rate of 9.76%. Any future dividend growth depends on both earnings growth and the payout ratio; The payout ratio is the ratio of the firm’s annual earnings per share that it spends on dividends. Equity Living Properties’ current payout ratio is 60%, meaning it pays out 60% of its trailing 12-month EPS dividend.
ELS growth results for this fiscal year. The Zacks Consensus Estimate for 2023 is $2.85 per share, which gives a year-over-year growth rate of 4.78%.
The only verse
From greatly improving stock investment yields and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of reasons. It’s important to keep in mind that not all companies offer quarterly payouts.
For example, it’s rare when a tech start-up or high-growth business offers shareholders a dividend. It is more common to see more companies with more stable earnings giving out dividends. In times of increasing interest, income investors should be aware that high-yielding stocks tend to compete. That said, they can take comfort in the fact that the ELS dividend play is not only attractive, but also a compelling investment opportunity with a Zacks Rank #2 (Buy).
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.