3 Days Left Before Eaton Vance Corp (NYSE:EV) Will Start Trading Ex-Dividend, Should You Buy?

If you are interested in cashing in on Eaton Vance Corp’s (NYSE:EV) upcoming dividend of $0.31 per share, you only have 3 days left to buy the shares before its ex-dividend date, 27 April 2018, in time for dividends payable on the 15 May 2018. Is this future income stream a compelling catalyst for dividend investors to think about the stock as an investment today? Let’s take a look at Eaton Vance’s most recent financial data to examine its dividend characteristics in more detail. Check out our latest analysis for Eaton Vance

5 questions I ask before picking a dividend stock

When researching a dividend stock, I always follow the following screening criteria:

  • Is its annual yield among the top 25% of dividend payers?
  • Has it paid dividend every year without dramatically reducing payout in the past?
  • Has dividend per share amount increased over the past?
  • Does earnings amply cover its dividend payments?
  • Will the company be able to keep paying dividend based on the future earnings growth?

NYSE:EV Historical Dividend Yield Apr 23rd 18
NYSE:EV Historical Dividend Yield Apr 23rd 18

Does Eaton Vance pass our checks?

The company currently pays out 44.20% of its earnings as a dividend, according to its trailing twelve-month data, meaning the dividend is sufficiently covered by earnings. However, going forward, analysts expect EV’s payout to fall to 37.01% of its earnings, which leads to a dividend yield of around 2.53%. However, EPS should increase to $3.33, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. Reliablity is an important factor for dividend stocks, particularly for income investors who want a strong track record of payment and a positive outlook for future payout. In the case of EV it has increased its DPS from $0.6 to $1.24 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. These are all positive signs of a great, reliable dividend stock. Relative to peers, Eaton Vance produces a yield of 2.25%, which is on the low-side for Capital Markets stocks.

Next Steps:

With this in mind, I definitely rank Eaton Vance 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. Below, I’ve compiled three important aspects you should further examine:

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