Houlihan Lokey, Inc.’s (NYSE:HLI) dividend will be increasing to $0.57 on the 15th of June, up from last year’s payment for the same period. Despite the higher dividend, the yield stands at 1.7%, which is below the industry average.
Prior to this announcement, Houlihan Lokey’s dividend was well covered by both cash flow and earnings, indicating a focus on reinvesting earnings into the business for growth. With a forecasted EPS expansion of 49.2% over the next year, the payout ratio could reach 43% by next year, a sustainable level going forward.
While the company has been paying a consistent dividend for some time, it would be prudent to wait a few more years to confirm its reliability. The dividend has been growing at a rate of 16% per annum over the past 9 years, with the most recent fiscal year payment at $2.28.
The company’s investors have been enjoying increasing dividend income, with EPS rising at 9.7% per annum over the last five years. Houlihan Lokey’s strong growth and earnings coverage make it an appealing income stock.
Overall, Houlihan Lokey’s increasing dividend and solid financials make it an attractive income stock. Investors should consider the stability of a company’s dividend policy before investing, as well as other relevant factors. It’s important to conduct thorough research before making any investment decisions.
This article by Simply Wall St provides commentary based on historical data and analyst forecasts using an unbiased methodology. It does not constitute financial advice and does not take into account individual objectives or financial situations. Simply Wall St aims to provide long-term focused analysis driven by fundamental data.