Federated Hermes, Inc. (NYSE:FHI) has announced a dividend payment of $0.31 on August 15th, with a dividend yield of 3.5%, which is higher than the industry average. Prior to this announcement, the company’s dividend was well covered by both cash flow and earnings, indicating that the payments are sustainable. In fact, most of the earnings are being retained to support business growth.
Looking back at the company’s dividend history, Federated Hermes has a solid track record of paying stable dividends. Since 2014, the annual dividend payment has increased from $1.00 to $1.24, representing a compound annual growth rate of approximately 2.2% over that time period. While the growth has been relatively slow, the consistency of the dividend payment may be attractive to some investors.
With a growth in earnings per share of 5.3% per year over the past five years, Federated Hermes shows potential for further dividend growth. The company also maintains a low payout ratio, which is a positive sign for the sustainability of the dividend. Overall, the company appears to be a good dividend stock, with distributions well covered by earnings and cash flows.
Investors typically prefer companies with a consistent dividend policy, as it provides a sense of stability and reliability. However, it is important to consider other factors beyond dividend payments when evaluating a company. Earnings growth, for example, can impact the future value of dividend payments.
If Federated Hermes does not align with your investment criteria, there are other top dividend stocks available to explore. Additionally, utilizing tools like the AI Stock Screener can help identify potential investment opportunities in the market.
Please note that the information provided in this article is based on historical data and analyst forecasts, and should not be considered financial advice. It is essential to conduct thorough research and analysis before making any investment decisions.
