Have you been waiting for Energizer Holdings Inc’s (NYSE:ENR) upcoming dividend of $0.29 per share? Then you only have to wait 4 more days before the stock pays out on 14 December 2017, and starts trading ex-dividend on the 29 November 2017. Is this future income a persuasive enough catalyst for investors to think about ENR 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. View our latest analysis for Energizer Holdings
5 checks you should use to assess a dividend stock
When researching a dividend stock, I always follow the following screening criteria:
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Is it paying an annual yield above 75% of dividend payers?
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Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
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Has it increased its dividend per share amount over the past?
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Is its earnings sufficient to payout dividend at the current rate?
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Will the company be able to keep paying dividend based on the future earnings growth?
How well does Energizer Holdings fit our criteria?
The current payout ratio for the stock is 33.68%, which means that the dividend is covered by earnings. Going forward, analysts expect ENR’s payout to increase to 39.17% of its earnings, which leads to a dividend yield of around 2.70%. However, EPS is forecasted to fall to $3.06 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. Unfortunately, it is really too early to view Energizer Holdings as a dividend investment. It has only been consistently paying dividends for 2 years, however, standard practice for reliable payers is to look for a 10-year minimum track record. In terms of its peers, Energizer Holdings produces a yield of 2.58%, which is on the low-side for household products stocks.
What this means for you:
Are you a shareholder? If ENR is in your portfolio for cash-generating reasons, there may be better alternatives out there. It may be valuable exploring other income stocks as alternatives to ENR or even look at high-growth stocks to supplement your steady income stocks. I suggest continuing your research by checking out my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.
Are you a potential investor? If you are building an income portfolio, then Energizer Holdings is a complicated choice since it has some positive aspects as well as negative ones. But if you are not exclusively a dividend investor, ENR could still be an interesting investment opportunity. As always, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. Dig deeping in our latest free fundmental analysis to explore other aspects of ENR.
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.