Yahoo Finance Why You Might Be Interested In Jack Henry & Associates, Inc. (NASDAQ:JKHY) For Its Upcoming Dividend
Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see Jack Henry & Associates, Inc. (NASDAQ:JKHY) is about to trade ex-dividend in the next 4 days. The ex-dividend date is usually set to be one business day before the record date which is the cut-off date on which you must be present on the company's books as a shareholder in order to receive the dividend. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. Therefore, if you purchase Jack Henry & Associates' shares on or after the 25th of May, you won't be eligible to receive the dividend, when it is paid on the 15th of June.
The company's next dividend payment will be US$0.52 per share. Last year, in total, the company distributed US$2.08 to shareholders. Calculating the last year's worth of payments shows that Jack Henry & Associates has a trailing yield of 1.4% on the current share price of $148.8. If you buy this business for its dividend, you should have an idea of whether Jack Henry & Associates's dividend is reliable and sustainable. As a result, readers should always check whether Jack Henry & Associates has been able to grow its dividends, or if the dividend might be cut.
Check out our latest analysis for Jack Henry & Associates
If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Jack Henry & Associates paid out a comfortable 42% of its profit last year.
When a company paid out less in dividends than it earned in profit, this generally suggests its dividend is affordable. The lower the % of its profit that it pays out, the greater the margin of safety for the dividend if the business enters a downturn.
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
Have Earnings And Dividends Been Growing?
Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If earnings fall far enough, the company could be forced to cut its dividend. For this reason, we're glad to see Jack Henry & Associates's earnings per share have risen 10% per annum over the last five years.
Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. In the past 10 years, Jack Henry & Associates has increased its dividend at approximately 16% a year on average. It's exciting to see that both earnings and dividends per share have grown rapidly over the past few years.
To Sum It Up
Has Jack Henry & Associates got what it takes to maintain its dividend payments? When companies are growing rapidly and retaining a majority of the profits within the business, it's usually a sign that reinvesting earnings creates more value than paying dividends to shareholders. This is one of the most attractive investment combinations under this analysis, as it can create substantial value for investors over the long run. In summary, Jack Henry & Associates appears to have some promise as a dividend stock, and we'd suggest taking a closer look at it.
Curious what other investors think of Jack Henry & Associates? See what analysts are forecasting, with this visualisation of its historical and future estimated earnings and cash flow.
Generally, we wouldn't recommend just buying the first dividend stock you see. Here's a curated list of interesting stocks that are strong dividend payers.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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