The opinion of the company Selective Insurance Group, Inc. (NASDAQ:SIGI) stock is about to sell off its previous session in three days. The ex-dividend date occurs one day before the record date which is the date on which the shareholders must be on the company’s books to receive the dividend. It is important to know the ex-dividend date because any trade in the stock must be completed on or before the ex-dividend date. Meaning, you need to buy Selective Insurance Group shares before August 12th to receive the dividend, which will be paid on September 1st.
The company will pay $0.28 per share, and in the last 12 months, the company paid $1.12 per share. Based on last year’s earnings, Selective Insurance Group stock has a yield of about 1.4% at the current price of $77.61. Dividends are the main contributor to returns for long-term holders, but only if the dividend continues to be paid. We need to see if the share is being paid for by earnings and if it is growing.
Dividends are usually paid out of a company’s profits, so if a company pays more than it earns then its share is at a greater risk of being cut. Selective Insurance Group paid out 25% of its profits last year.
Generally, the lower a company’s dividend payout ratio, the stronger its dividend.
Have Earnings And Profits Been Growing?
Stocks in companies that generate stable profits often make the best prospects for shareholders, because it’s easier to raise profits when profits rise. Investors love dividends, so if profits are falling and the share is shrinking, expect the stock to sell off immediately. That’s why it’s refreshing to see Selective Insurance Group’s earnings per share rise 9.4% annually over the past five years.
Many investors evaluate a company’s performance by looking at how dividend payouts have changed over time. Selective Insurance Group has returned 8.0% annually over the past 10 years. It is encouraging to see the company raising dividends while profits are growing, which shows the company’s commitment to benefiting its shareholders.
Is Selective Insurance Group a great stock, or a good one left on the shelf? It has been growing its earnings per share in recent years, even though it is returning more than half of its earnings to the business, which may indicate that there is still some significant work to be done. Selective Insurance Group ticks a lot of boxes for us to benefit from, and we think that should mark the company as worthy of further support.
In light of this, while Selective Insurance Group is an interesting stock, it is important to know the risks associated with this stock. Every company has risks, and we’ve seen them 2 warning signs of Selective Insurance Group you should know about.
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This article by Simply Wall St is more general in nature. We provide reviews based on historical data and expert forecasts using unbiased methods and our articles are not intended to be financial advice. It does not make recommendations to buy or sell any stock, and does not take into account your goals, or your financial situation. We want to bring you long-term analytics driven by meaningful data. Note that our analysis may not be influenced by recent company announcements or stock prices. Simply Wall St does not have a position in any of the listed stocks.
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