The best dividend stocks are highlighted in IBD’s Income Investor. Prudential Financial (PRU) is worth a closer look this week, boasting a solid dividend and stable fundamentals.
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Prudential Financial is a $35.8 billion financial services company founded and headquartered in Newark, N.J. It provides life insurance, annuities, mutual funds and other financial products in the U.S. and 40 countries. U.S. operations comprise more than half of Prudential’s $1.7 trillion of assets while Japan leads international assets.
Prudential 10% Annual Dividend Stock Growth
The strong dividend yield is Prudential’s standout feature, currently paying 5.0% — well above the 1.7% S&P 500 composite yield.
Dividends have grown every year since 2008, showing historic consistency, with an impressive 10% annual growth rate in the last five years. The next quarterly dividend is scheduled for mid-November when shareholders of record will receive $1.20 per share.
Stable fundamentals back up strong dividend growth. The financial strength of Prudential and its subsidiaries are rated “A+” by Standard & Poor’s.
Prudential is one of the best dividend stocks, but growth has been lacking in recent quarters.
The company reported a $14.58 per-share profit in 2021 but earnings are expected to decline to $9.71 this year, before rebounding to $11.71 in 2023. A one-time assumption charge hit last quarter, generating whipsaws in longer-term metrics.
The company will report Q3 earnings on Nov. 1, with analysts looking for a profit of $2.01 per share.
While meager growth has not affected Prudential’s dividend, it has slowed share buybacks. Prudential bought back $375 million in shares in the second quarter — half the buybacks compared to a year earlier.
Shares of this dividend stock are down 12% year-to-date but have displayed strength recently and climbed back above their 50-day moving average.
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Source: https://www.investors.com/research/the-income-investor/best-dividend-stocks-prudential-payout-is-historic/?src=A00220&yptr=yahoo