2 Days Left To Cash In On Newell Brands Inc (NYSE:NWL) Dividend, Should Investors Buy?

Have you been keeping an eye on Newell Brands Inc’s (NYSE:NWL) upcoming dividend of US$0.23 per share payable on the 14 September 2018? Then you only have 2 days left before the stock starts trading ex-dividend on the 30 August 2018. Is this future income a persuasive enough catalyst for investors to think about Newell Brands as an investment today? Below, I’m going to look at the latest data and analyze the stock and its dividend property in further detail.

Check out our latest analysis for Newell Brands

How I analyze a dividend stock

When researching a dividend stock, I always follow the following screening criteria:

• Is it paying an annual yield above 75% of dividend payers?

• Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?

• Has dividend per share risen in the past couple of years?

• Does earnings amply cover its dividend payments?

• Based on future earnings growth, will it be able to continue to payout dividend at the current rate?

NYSE:NWL Historical Dividend Yield August 27th 18

How does Newell Brands fare?

Newell Brands has a trailing twelve-month payout ratio of 21.8%, which means that the dividend is covered by earnings. In the near future, analysts are predicting a higher payout ratio of 42.3%, leading to a dividend yield of 4.3%. However, EPS is forecasted to fall to $1.18 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income.

If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. Whilst its per-share payments have increased during the past 10 years, there has been some hiccups. Investors have seen reductions in the dividend per share in the past, although, it has picked up again.

Relative to peers, Newell Brands generates a yield of 4.2%, which is high for Consumer Durables stocks.

Next Steps:

Keeping in mind the dividend characteristics above, Newell Brands is definitely worth considering for investors looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, 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. Below, I’ve compiled three relevant aspects you should further examine:

1. Future Outlook: What are well-informed industry analysts predicting for NWL’s future growth? Take a look at our free research report of analyst consensus for NWL’s outlook.

2. Valuation: What is NWL 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 NWL is currently mispriced by the market.

3. 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.