Aceto Corporation (NASDAQ:ACET) has pleased shareholders over the past 10 years, paying out an average dividend of 2.00% annually. The company is currently worth US$236.87M, and now yields roughly 3.46%. Should it have a place in your portfolio? Let’s take a look at Aceto in more detail. Check out our latest analysis for Aceto

Here’s how I find good dividend stocks

Whenever I am looking at a potential dividend stock investment, I always check these five metrics:

• Is it the top 25% annual dividend yield payer?

• Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?

• Has the amount of dividend per share grown over the past?

• Can it afford 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 Aceto fare?

Aceto has a negative payout ratio, which means that it is loss-making, and paying its dividend from its retained earnings. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. ACET has increased its DPS from $0.2 to $0.26 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. This is an impressive feat, which makes ACET a true dividend rockstar. Relative to peers, Aceto produces a yield of 3.46%, which is high for Healthcare stocks.

Next Steps:

With this in mind, I definitely rank Aceto as a strong dividend stock, and makes it worth further research for anyone who likes steady income generation from their 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 fundamental aspects you should further examine:

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

2. Valuation: What is ACET 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 ACET 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 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.