Attention dividend hunters! Oil-Dri Corporation of America (NYSE:ODC) will be distributing its dividend of $0.23 per share on the 02 March 2018, and will start trading ex-dividend in 2 days time on the 15 February 2018. What does this mean for current shareholders and potential investors? Below, I will explain how holding Oil-Dri of America can impact your portfolio income stream, by analysing the stock’s most recent financial data and dividend attributes. Check out our latest analysis for Oil-Dri of America

5 checks you should use to assess a dividend stock

If you are a dividend investor, you should always assess these five key metrics:

• Is their annual yield among the top 25% of dividend payers?

• Has it paid dividend every year without dramatically reducing payout in the past?

• Has it increased its dividend per share amount over the past?

• Does earnings amply cover its dividend payments?

• Will it have the ability to keep paying its dividends going forward?

Does Oil-Dri of America pass our checks?

Oil-Dri of America has a trailing twelve-month payout ratio of 55.40%, meaning the dividend is sufficiently covered by earnings. Furthermore, analysts have not forecasted a dividends per share for the future, which makes it hard to determine the yield shareholders should expect, and whether the current payout is sustainable, moving forward. 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. ODC has increased its DPS from $0.52 to $0.92 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. This is an impressive feat, which makes ODC a true dividend rockstar. Relative to peers, Oil-Dri of America generates a yield of 2.51%, which is high for Household Products stocks but still below the market’s top dividend payers.

Next Steps:

Keeping in mind the dividend characteristics above, Oil-Dri of America is definitely worth considering for investors 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. Below, I’ve compiled three key aspects you should further examine:

• 1. Valuation: What is ODC 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 ODC is currently mispriced by the market.

• 2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Oil-Dri of America’s board and the CEO’s back ground.

• 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 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.