Hackett Group (NASDAQ:HCKT) Will Pay A Dividend Of US$0.10

By
Simply Wall St
Published
November 15, 2021
NasdaqGS:HCKT
Source: Shutterstock

The Hackett Group, Inc. (NASDAQ:HCKT) will pay a dividend of US$0.10 on the 30th of December. This makes the dividend yield 1.8%, which will augment investor returns quite nicely.

Check out our latest analysis for Hackett Group

Hackett Group's Payment Has Solid Earnings Coverage

Impressive dividend yields are good, but this doesn't matter much if the payments can't be sustained. Prior to this announcement, Hackett Group's dividend was comfortably covered by both cash flow and earnings. This indicates that quite a large proportion of earnings is being invested back into the business.

Over the next year, EPS is forecast to expand by 19.4%. If the dividend continues along recent trends, we estimate the payout ratio will be 43%, which is in the range that makes us comfortable with the sustainability of the dividend.

historic-dividend
NasdaqGS:HCKT Historic Dividend November 16th 2021

Hackett Group Is Still Building Its Track Record

The dividend's track record has been pretty solid, but with only 9 years of history we want to see a few more years of history before making any solid conclusions. The first annual payment during the last 9 years was US$0.10 in 2012, and the most recent fiscal year payment was US$0.40. This works out to be a compound annual growth rate (CAGR) of approximately 17% a year over that time. Hackett Group has been growing its dividend quite rapidly, which is exciting. However, the short payment history makes us question whether this performance will persist across a full market cycle.

Hackett Group Could Grow Its Dividend

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. It's encouraging to see Hackett Group has been growing its earnings per share at 6.2% a year over the past five years. The company is paying a reasonable amount of earnings to shareholders, and is growing earnings at a decent rate so we think it could be a decent dividend stock.

Our Thoughts On Hackett Group's Dividend

In summary, we are pleased with the dividend remaining consistent, and we think there is a good chance of this continuing in the future. The dividend has been at reasonable levels historically, but that hasn't translated into a consistent payment. The dividend looks okay, but there have been some issues in the past, so we would be a little bit cautious.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. For example, we've picked out 1 warning sign for Hackett Group that investors should know about before committing capital to this stock. Looking for more high-yielding dividend ideas? Try our curated list of strong dividend payers.

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