Yahoo Finance Income Investors Should Know The Ameriprise Financial Inc (NYSE:AMP) Ex-Dividend Date
Have you been keeping an eye on Ameriprise Financial Inc’s (NYSE:AMP) upcoming dividend of US$0.90 per share payable on the 16 November 2018? Then you only have 4 days left before the stock starts trading ex-dividend on the 02 November 2018. What does this mean for current shareholders and potential investors? Below, I will explain how holding Ameriprise Financial can impact your portfolio income stream, by analysing the stock’s most recent financial data and dividend attributes.
Check out our latest analysis for Ameriprise Financial
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 paying an annual yield above 75% of dividend payers?
Has it paid dividend every year without dramatically reducing payout in the past?
Has the amount of dividend per share grown over the past?
Is is 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 Ameriprise Financial fit our criteria?
Ameriprise Financial has a trailing twelve-month payout ratio of 29%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting lower payout ratio of 24%, leading to a dividend yield of around 3.2%. However, EPS should increase to $15.14, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment.
When thinking about whether a dividend is sustainable, another factor to consider is the cash flow. A business with strong cash flow can sustain a higher divided payout ratio than a company with weak cash flow.
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. In the case of AMP it has increased its DPS from $0.68 to $3.6 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 AMP a true dividend rockstar.
Compared to its peers, Ameriprise Financial produces a yield of 2.9%, which is high for Capital Markets stocks but still below the market’s top dividend payers.
Next Steps:
Keeping in mind the dividend characteristics above, Ameriprise Financial 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. There are three pertinent factors you should further research:
Future Outlook: What are well-informed industry analysts predicting for AMP’s future growth? Take a look at our free research report of analyst consensus for AMP’s outlook.
Valuation: What is AMP 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 AMP is currently mispriced by the market.
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.
