On the 20 March 2018, Analog Devices Inc (NASDAQ:ADI) will be paying shareholders an upcoming dividend amount of $0.48 per share. However, investors must have bought the company’s stock before 08 March 2018 in order to qualify for the payment. That means you have only 2 days left! Should you diversify into Analog Devices and boost your portfolio income stream? Well, keep on reading because today, I’m going to look at the latest data and analyze the stock and its dividend property in further detail. See our latest analysis for Analog Devices

5 checks you should use to assess a dividend stock

When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:

• Does it pay an annual yield higher than 75% 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?

• Is it able to pay the current rate of dividends from its earnings?

• Will it be able to continue to payout at the current rate in the future?

How well does Analog Devices fit our criteria?

The company currently pays out 83.84% of its earnings as a dividend, according to its trailing twelve-month data, meaning the dividend is sufficiently covered by earnings. However, going forward, analysts expect ADI’s payout to fall to 33.51% of its earnings, which leads to a dividend yield of around 2.15%. However, EPS should increase to $4.03, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. ADI has increased its DPS from $0.72 to $1.92 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. These are all positive signs of a great, reliable dividend stock. Relative to peers, Analog Devices produces a yield of 2.15%, which is high for Semiconductor stocks but still below the low risk savings rate.

Next Steps:

With these dividend metrics in mind, I definitely rank Analog Devices as a strong income stock, and is worth further research for anyone who considers dividends an important part of their portfolio strategy. Given that this is purely a dividend analysis, I recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. Below, I’ve compiled three fundamental aspects you should further examine: