Northern Trust Corporation (NASDAQ:NTRS) Looks Interesting, And It's About To Pay A Dividend
NASDAQ:NTRS) is about to go ex-dividend in the next 4 days. Ex-dividend means that investors that purchase the stock on or after the 10th of September will not receive this dividend, which will be paid on the 1st of October.” data-reactid=”28″>It looks like Northern Trust Corporation (NASDAQ:NTRS) is about to go ex-dividend in the next 4 days. Ex-dividend means that investors that purchase the stock on or after the 10th of September will not receive this dividend, which will be paid on the 1st of October.
Northern Trust’s upcoming dividend is US$0.70 a share, following on from the last 12 months, when the company distributed a total of US$2.80 per share to shareholders. Looking at the last 12 months of distributions, Northern Trust has a trailing yield of approximately 3.3% on its current stock price of $84.45. We love seeing companies pay a dividend, but it’s also important to be sure that laying the golden eggs isn’t going to kill our golden goose! That’s why we should always check whether the dividend payments appear sustainable, and if the company is growing.
View our latest analysis for Northern Trust ” data-reactid=”30″> View our latest analysis for Northern Trust
Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Fortunately Northern Trust’s payout ratio is modest, at just 43% of profit.
When a company paid out less in dividends than it earned in profit, this generally suggests its dividend is affordable. The lower the % of its profit that it pays out, the greater the margin of safety for the dividend if the business enters a downturn.
here to see the company’s payout ratio, plus analyst estimates of its future dividends.” data-reactid=”37″>Click here to see the company’s payout ratio, plus analyst estimates of its future dividends.
Have Earnings And Dividends Been Growing?
Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. Fortunately for readers, Northern Trust’s earnings per share have been growing at 14% a year for the past five years.
Many investors will assess a company’s dividend performance by evaluating how much the dividend payments have changed over time. In the past 10 years, Northern Trust has increased its dividend at approximately 9.6% a year on average. We’re glad to see dividends rising alongside earnings over a number of years, which may be a sign the company intends to share the growth with shareholders.
To Sum It Up
Should investors buy Northern Trust for the upcoming dividend? When companies are growing rapidly and retaining a majority of the profits within the business, it’s usually a sign that reinvesting earnings creates more value than paying dividends to shareholders. This is one of the most attractive investment combinations under this analysis, as it can create substantial value for investors over the long run. We think this is a pretty attractive combination, and would be interested in investigating Northern Trust more closely.
with this visualisation of its historical and future estimated earnings and cash flow” data-reactid=”55″>Ever wonder what the future holds for Northern Trust? See what the 11 analysts we track are forecasting, with this visualisation of its historical and future estimated earnings and cash flow
checking our list of top dividend stocks with a greater than 2% yield and an upcoming dividend.” data-reactid=”56″>If you’re in the market for dividend stocks, we recommend checking our list of top dividend stocks with a greater than 2% yield and an upcoming dividend.
Get in touch with us directly. Alternatively, email [email protected].” data-reactid=”57″>This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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