Are You Looking for a High-Growth Dividend Stock?

Zacks Equity Research

Mon, Mar 31, 2025, 8:45 AM 2 min read

Getting large returns from fiscal portfolios, whether done stocks, bonds, ETFs, different securities, oregon a operation of all, is an investor's dream. But erstwhile you're an income investor, your superior absorption is generating accordant currency travel from each of your liquid investments.

Cash travel tin travel from enslaved interest, involvement from different types of investments, and of course, dividends. A dividend is that coveted organisation of a company's net paid retired to shareholders, and investors often presumption it by its dividend yield, a metric that measures the dividend arsenic a percent of the existent banal price. Many world studies amusement that dividends relationship for important portions of semipermanent returns, with dividend contributions exceeding one-third of full returns successful galore cases.

Headquartered successful New Brunswick, Johnson & Johnson (JNJ) is simply a Medical banal that has seen a terms alteration of 13.2% truthful acold this year. The world's biggest shaper of wellness attraction products is paying retired a dividend of $1.24 per stock astatine the moment, with a dividend output of 3.03% compared to the Large Cap Pharmaceuticals industry's output of 2.24% and the S&P 500's output of 1.59%.

In presumption of dividend growth, the company's existent annualized dividend of $4.96 is up 1% from past year. Johnson & Johnson has accrued its dividend 5 times connected a year-over-year ground implicit the past 5 years for an mean yearly summation of 5.54%. Looking ahead, aboriginal dividend maturation volition beryllium babelike connected net maturation and payout ratio, which is the proportionality of a company's yearly net per stock that it pays retired arsenic a dividend. Right now, Johnson & Johnson's payout ratio is 50%, which means it paid retired 50% of its trailing 12-month EPS arsenic dividend.

Looking astatine this fiscal year, JNJ expects coagulated net growth. The Zacks Consensus Estimate for 2025 is $10.58 per share, which represents a year-over-year maturation complaint of 6.01%.

Investors similar dividends for galore reasons; they greatly amended banal investing profits, alteration wide portfolio risk, and transportation taxation advantages, among others. It's important to support successful caput that not each companies supply a quarterly payout.

High-growth firms oregon tech start-ups, for example, seldom supply their shareholders a dividend, portion larger, much established companies that person much unafraid profits are often seen arsenic the champion dividend options. Income investors person to beryllium mindful of the information that high-yielding stocks thin to conflict during periods of rising involvement rates. With that successful mind, JNJ is simply a compelling concern opportunity. Not lone is it a beardown dividend play, but the banal presently sits astatine a Zacks Rank of 3 (Hold).