Yahoo Finance 2 Days Left Before The Allstate Corporation (NYSE:ALL) Will Start Trading Ex-Dividend, Is It Worth Buying?
Important news for shareholders and potential investors in The Allstate Corporation (NYSE:ALL): The dividend payment of US$0.46 per share will be distributed into shareholder on 01 October 2018, and the stock will begin trading ex-dividend at an earlier date, 30 August 2018. What does this mean for current shareholders and potential investors? Below, I will explain how holding Allstate can impact your portfolio income stream, by analysing the stock’s most recent financial data and dividend attributes.
Check out our latest analysis for Allstate
How I analyze a dividend stock
If you are a dividend investor, you should always assess these five key metrics:
Does it pay an annual yield higher than 75% of dividend payers?
Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
Has it increased its dividend per share amount over the past?
Is is able to pay the current rate of dividends from its earnings?
Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
How does Allstate fare?
Allstate has a trailing twelve-month payout ratio of 17.2%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting a higher payout ratio of 21.6%, leading to a dividend yield of around 1.9%. However, EPS is forecasted to fall to $9.03 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income.
If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. Although ALL’s per share payments have increased in the past 10 years, it has not been a completely smooth ride. Investors have seen reductions in the dividend per share in the past, although, it has picked up again.
In terms of its peers, Allstate generates a yield of 1.8%, which is on the low-side for Insurance stocks.
Next Steps:
Considering the dividend attributes we analyzed above, Allstate is definitely worth keeping an eye on for someone looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. There are three key factors you should further research:
Future Outlook: What are well-informed industry analysts predicting for ALL’s future growth? Take a look at our free research report of analyst consensus for ALL’s outlook.
Valuation: What is ALL worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether ALL is currently mispriced by the market.
Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.
To help readers see past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
