Professional service names generally suffer from deep cyclicality which can affect companies operating in areas ranging from consulting to security services. Hence, considering economic volatility is crucial when thinking about a professional services company’s profitability. This impacts cash flows which in turn determines the level of dividend payout. During times of growth, these companies could provide a strong boost to your portfolio income. Here are my top dividend stocks in the services industry that could be valuable additions to your current holdings.
Acme United Corporation (AMEX:ACU)
ACU has a good dividend yield of 2.22% and distributes 35.61% of its earnings to shareholders as dividends . Over the past 10 years, ACU has increased its dividends from US$0.16 to US$0.44. They have been consistent too, not missing a payment during this 10 year period. Analysts are enthusiastic about the company’s future growth, estimating a 36.66% earnings per share increase over the next 12 months. More on Acme United here.
Liberty Tax, Inc. (NASDAQ:TAX)
TAX has a substantial dividend yield of 6.43% and distributes 70.04% of its earnings to shareholders as dividends . The company’s 6.43% dividend is both above the low risk savings rate and among the markets top payers. Liberty Tax is also reasonably priced, with a PE ratio of 10.9 that compares favorably with the US Consumer Services average of 20.6. Dig deeper into Liberty Tax here.
Knoll, Inc. (NYSE:KNL)
KNL has a nice dividend yield of 3.07% and pays out 36.24% of its profit as dividends , with an expected payout of 44.84% in three years. Although there has been some volatility in the company’s dividend yield, the DPS over a 10 year period has increased from US$0.48 to US$0.60. Dig deeper into Knoll here.
For more solid dividend paying companies to add to your portfolio, explore this interactive list of top dividend payers.