Yahoo Finance KeyCorp (NYSE:KEY): Ex-Dividend Is In 2 Days, Should You Buy?
If you are interested in cashing in on KeyCorp’s (NYSE:KEY) upcoming dividend of US$0.17 per share, you only have 2 days left to buy the shares before its ex-dividend date, 27 August 2018, in time for dividends payable on the 14 September 2018. Is this future income a persuasive enough catalyst for investors to think about KeyCorp as an investment today? Below, I’m going to look at the latest data and analyze the stock and its dividend property in further detail.
See our latest analysis for KeyCorp
5 checks you should do on a dividend stock
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
Is it paying an annual yield above 75% of dividend payers?
Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
Has dividend per share risen in the past couple of years?
Does earnings amply cover its dividend payments?
Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
How well does KeyCorp fit our criteria?
The current trailing twelve-month payout ratio for the stock is 32.2%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting a higher payout ratio of 38.3%, leading to a dividend yield of 3.2%. Furthermore, EPS should increase to $1.83. The higher payout forecasted, along with higher earnings, should lead to greater dividend income for investors moving forward.
If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. Dividend payments from KeyCorp have been volatile in the past 10 years, with some years experiencing significant drops of over 25%. This means that dividend hunters should probably steer clear of the stock, at least for now until the track record improves.
Compared to its peers, KeyCorp produces a yield of 3.2%, which is on the low-side for Banks stocks.
Next Steps:
If you are building an income portfolio, then KeyCorp is a complicated choice since it has some positive aspects as well as negative ones. But if you are not exclusively a dividend investor, the stock could still be an interesting investment opportunity. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. Below, I’ve compiled three relevant factors you should further examine:
Future Outlook: What are well-informed industry analysts predicting for KEY’s future growth? Take a look at our free research report of analyst consensus for KEY’s outlook.
Valuation: What is KEY 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 KEY is currently mispriced by the market.
Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
