We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Chesapeake Utilities (CPK) is a Great Dividend Stock Right Now
Read MoreHide Full Article
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Chesapeake Utilities in Focus
Based in Dover, Chesapeake Utilities (CPK - Free Report) is in the Utilities sector, and so far this year, shares have seen a price change of 3.45%. The energy and utility company is paying out a dividend of $1.28 per share at the moment, with a dividend yield of 2.04% compared to the Utility - Gas Distribution industry's yield of 3.31% and the S&P 500's yield of 1.58%.
Looking at dividend growth, the company's current annualized dividend of $2.56 is up 2% from last year. In the past five-year period, Chesapeake Utilities has increased its dividend 5 times on a year-over-year basis for an average annual increase of 10.07%. Any future dividend growth will depend on both earnings growth and the company's payout ratio; a payout ratio is the proportion of a firm's annual earnings per share that it pays out as a dividend. Chesapeake Utilities's current payout ratio is 47%, meaning it paid out 47% of its trailing 12-month EPS as dividend.
CPK is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2025 is $6.27 per share, representing a year-over-year earnings growth rate of 16.33%.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. However, not all companies offer a quarterly payout.
High-growth firms or tech start-ups, for example, rarely provide their shareholders a dividend, while larger, more established companies that have more secure profits are often seen as the best dividend options. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. That said, they can take comfort from the fact that CPK is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Chesapeake Utilities (CPK) is a Great Dividend Stock Right Now
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Chesapeake Utilities in Focus
Based in Dover, Chesapeake Utilities (CPK - Free Report) is in the Utilities sector, and so far this year, shares have seen a price change of 3.45%. The energy and utility company is paying out a dividend of $1.28 per share at the moment, with a dividend yield of 2.04% compared to the Utility - Gas Distribution industry's yield of 3.31% and the S&P 500's yield of 1.58%.
Looking at dividend growth, the company's current annualized dividend of $2.56 is up 2% from last year. In the past five-year period, Chesapeake Utilities has increased its dividend 5 times on a year-over-year basis for an average annual increase of 10.07%. Any future dividend growth will depend on both earnings growth and the company's payout ratio; a payout ratio is the proportion of a firm's annual earnings per share that it pays out as a dividend. Chesapeake Utilities's current payout ratio is 47%, meaning it paid out 47% of its trailing 12-month EPS as dividend.
CPK is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2025 is $6.27 per share, representing a year-over-year earnings growth rate of 16.33%.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. However, not all companies offer a quarterly payout.
High-growth firms or tech start-ups, for example, rarely provide their shareholders a dividend, while larger, more established companies that have more secure profits are often seen as the best dividend options. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. That said, they can take comfort from the fact that CPK is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).