In this article, we discuss 10 high dividend stocks with attractive payout ratios. If you want to see some more stocks in this selection, click 5 High Dividend Stocks with Attractive Payout Ratios.
Dividend payout ratio is a measure of the amount distributed to shareholders relative to the company’s net income. A payout ratio of 30% to 50% is considered to be healthy and sustainable, but a company’s priorities at different stages impact the ratio significantly. For example, a high growth company usually reinvests profits to finance expansion activities, whereas a mature business tends to pay higher dividends to shareholders.
Global dividends were projected to reach $1.4 trillion in 2021, nearing pre-pandemic levels, but the uncertain macro backdrop in 2022 makes it difficult to forecast the payouts for this year. While most investors buy The Coca-Cola Company (NYSE:KO), Altria Group, Inc. (NYSE:MO), and Exxon Mobil Corporation (NYSE:XOM) for dividend income, our focus in this article would be some high-yield dividend stocks with attractive payout ratios.
Photo by Vitaly Taranov on Unsplash
Our Methodology
We selected dividend paying stocks with a yield of over 4% as of March 25, and a dividend payout ratio below 50%. We tried to find companies that can realistically continue to pay dividends in the future, while funding growth activities and continuing to improve their fundamentals.
High Dividend Stocks with Attractive Payout Ratios
10. Alliance Resource Partners, L.P. (NASDAQ:ARLP)
Dividend Yield as of March 25: 6.39%
Dividend Payout Ratio: 47.45%
Number of Hedge Fund Holders: 5
Headquartered in Tulsa, Oklahoma, Alliance Resource Partners, L.P. (NASDAQ:ARLP) is a natural resource company that produces and sells coal to industrial users in the United States. The stock yields 6.39% as of March 25.
On January 28, Alliance Resource Partners, L.P. (NASDAQ:ARLP) declared a $0.25 per share quarterly dividend, a 25% increase from its prior dividend of $0.20. The dividend was distributed to shareholders on February 14.
Alliance Resource Partners, L.P. (NASDAQ:ARLP) reported its Q4 results on January 31, posting a revenue of $473.47 million, above consensus by $11.17 million. The company continued to benefit from favorable market conditions during Q4 2021, reporting notable increases over the prior-year quarter in coal, oil, and gas sales volumes, total revenues, net income, and EBITDA.
According to the fourth quarter database of Insider Monkey, 5 hedge funds were bullish on Alliance Resource Partners, L.P. (NASDAQ:ARLP), compared to 6 funds in the prior quarter. Magnolia Capital Fund held the biggest stake in the company, with approximately 5 million shares worth $62.5 million.
In addition to The Coca-Cola Company (NYSE:KO), Altria Group, Inc. (NYSE:MO), and Exxon Mobil Corporation (NYSE:XOM), Alliance Resource Partners, L.P. (NASDAQ:ARLP) is a notable dividend payer in the current market.
9. Alico, Inc. (NASDAQ:ALCO)
Dividend Yield as of March 25: 5.62%
Dividend Payout Ratio: 36.29%
Number of Hedge Fund Holders: 7
Alico, Inc. (NASDAQ:ALCO) operates as an agribusiness and land management company in the United States. The stock gained almost 10% in the last month amid the macro war backdrop, as agriculture stocks rose due to the global food shortages.
In Q4 2021, 7 elite hedge funds were bullish on Alico, Inc. (NASDAQ:ALCO), compared to 10 funds in the earlier quarter. Renaissance Technologies owned the largest stake in the company, comprising 43,405 shares worth $1.60 million.
On February 25, Alico, Inc. (NASDAQ:ALCO) declared a $0.50 per share quarterly dividend. The dividend will be distributed on April 8, to shareholders of record on March 25. The dividend yield for Alico, Inc. (NASDAQ:ALCO) on March 25 came in at 5.62%.
Alico, Inc. (NASDAQ:ALCO) posted its fourth quarter results on February 3, announcing a GAAP EPS of $0.50, above market consensus by $0.08. Revenue for the period came in at $15.34 million, outperforming analysts’ estimates by $2.34 million.
Here is what Third Avenue Management has to say about Alico, Inc. (NASDAQ:ALCO) in its Q1 2021 investor letter:
“We also exited the Fund’s investment in long-time holding Alico, one of the largest citrus producers in the US. While Alico’s management has made good progress in streamlining and bettering the company, competition from foreign producers has weighed on industry pricing and we believe this is likely to remain a constraint on the industry for the foreseeable future.”
8. Eagle Bulk Shipping Inc. (NASDAQ:EGLE)
Dividend Yield as of March 25: 12.58%
Dividend Payout Ratio: 33.01%
Number of Hedge Fund Holders: 12
Eagle Bulk Shipping Inc. (NASDAQ:EGLE) was incorporated in 2005 and is headquartered in Stamford, Connecticut, operating as ocean transporter of dry bulk cargoes worldwide.
Eagle Bulk Shipping Inc. (NASDAQ:EGLE) delivers a dividend yield of 12.58% as of March 25. Eagle Bulk Shipping Inc. (NASDAQ:EGLE) on March 11 declared a $2.05 per share quarterly dividend, a 2.5% increase from its prior dividend of $2.0. The dividend was paid on March 25.
On March 7, B. Riley analyst Liam Burke raised the price target on Eagle Bulk Shipping Inc. (NASDAQ:EGLE) to $67 from $62 and maintained a Buy rating on the shares after the Q4 results were published. The analyst raised estimates to reflect the forecasted outlook for 2022, which was better than expected. The macro environment for Eagle Bulk Shipping Inc. (NASDAQ:EGLE) is favorable, and the company has an appropriate mix of assets to capitalize on that, the analyst told investors in a bullish thesis.
Among the hedge funds tracked by Insider Monkey, 12 hedge funds were bullish on Eagle Bulk Shipping Inc. (NASDAQ:EGLE), compared to 13 funds in the earlier quarter. Howard Marks’ Oaktree Capital Management is the biggest shareholder of Eagle Bulk Shipping Inc. (NASDAQ:EGLE), with 3.7 million shares worth $172 million.
7. Big 5 Sporting Goods Corporation (NASDAQ:BGFV)
Dividend Yield as of March 25: 5.91%
Dividend Payout Ratio: 18.49%
Number of Hedge Fund Holders: 14
Big 5 Sporting Goods Corporation (NASDAQ:BGFV) is a California-based sporting goods retailer that markets and sells athletic shoes, apparel, sporting equipment, and accessories. Big 5 Sporting Goods Corporation (NASDAQ:BGFV)’s dividend yield on March 25 stood at 5.91%, and the stock delivers an attractive payout ratio of 18.49%.
On March 1, Big 5 Sporting Goods Corporation (NASDAQ:BGFV) reported earnings for the fourth quarter of 2021. The EPS came in at $0.89, ahead of analysts’ estimates by $0.04. Revenue for the quarter was $273.40 million, surpassing market consensus by $3.91 million.
Big 5 Sporting Goods Corporation (NASDAQ:BGFV) on March 1 declared a quarterly dividend of $0.25 per share. The dividend was paid on March 25. The company disclosed the authorization of a new share repurchase program for up to $25 million of the company’s common stock. Common shares worth $7.7 million remained available for repurchase under Big 5 Sporting Goods Corporation (NASDAQ:BGFV)’s last program.
Lake Street analyst Mark Smith lowered the price target on Big 5 Sporting Goods Corporation (NASDAQ:BGFV) to $28 from $31 and reiterated a Buy rating on the shares after the company announced its fourth quarter results. The analyst thinks that Big 5 Sporting Goods Corporation (NASDAQ:BGFV) had a solid quarter, and most of the favorable momentum spilled into Q1. The stock remains undervalued according to the analyst.
According to Insider Monkey’s Q4 data, 14 hedge funds placed long bets on Big 5 Sporting Goods Corporation (NASDAQ:BGFV), compared to 17 funds in the prior quarter. Alok Agrawal’s Bloom Tree Partners is the largest shareholder of the company, with 568,068 shares worth $10.7 million.
6. Lazard Ltd (NYSE:LAZ)
Dividend Yield as of March 25: 5.36%
Dividend Payout Ratio: 37.23%
Number of Hedge Fund Holders: 15
Lazard Ltd (NYSE:LAZ) is a financial advisory and asset management company with customers located in North America, Europe, Asia, Australia, and Central and South America.
Among the hedge funds tracked by Insider Monkey, 15 funds were long Lazard Ltd (NYSE:LAZ) at the end of December 2021, compared to 18 funds in the earlier quarter. John W. Rogers’ Ariel Investments held the largest stake in the company, owning more than 8 million shares worth $354.3 million.
On February 2, Lazard Ltd (NYSE:LAZ) declared a quarterly dividend of $0.47 per share. The dividend was paid on February 25, for shareholders of record February 14. The company delivered a dividend yield of 5.36% on March 25.
Piper Sandler analyst Jeffrey Harte reiterated an Overweight rating on Lazard Ltd (NYSE:LAZ) but lowered the price target on the stock to $52 from $62 on March 9. The reduced price target for independent financial advisors reflects increased uncertainty in the macro backdrop, according to the analyst.
Lazard Ltd (NYSE:LAZ) is a high dividend stock which can make a good addition to an income portfolio, just like The Coca-Cola Company (NYSE:KO), Altria Group, Inc. (NYSE:MO), and Exxon Mobil Corporation (NYSE:XOM).
Here is what Longleaf Partners Small-Cap Fund has to say about Lazard Ltd (NYSE:LAZ) in its Q4 2021 investor letter:
” In Financials, we own asset manager Lazard and two newer companies, all three of which are harder to understand than the simpler banks that drove the sector. We are confident that this differentiated positioning that caused the relative drag this year will be the very driver of future absolute and relative outperformance.”
Click to continue reading and see 5 High Dividend Stocks with Attractive Payout Ratios.
Suggested articles:
- 10 ETFs to Buy and Hold for the Next 10 Years
- 10 Stocks to Buy Before the Next Recession
- 10 Undervalued Small-Cap Stocks to Buy Now
Disclosure: None. 10 High Dividend Stocks with Attractive Payout Ratios is originally published on Insider Monkey.
