We all know that dividends can be a wonderful way to either supplement current income or provide a base of income during retirement. But, in order to be successful on that front, investors need to have some idea of what the future holds. After all, when you’re relying on steady payouts from stocks and funds to pay your mortgage or grocery bill, you can’t be left short-handed with a dividend cut.
And that’s where Dividend.com’s new Dividend Payout Estimates feature comes in handy.
Dividend.com’s new Premium feature uses a proprietary system to both analyze and predict future dividend payouts from a wide range of stocks, exchange-traded funds (ETFs), closed-end funds, REITs, MLPs, ADRs and mutual funds. Investors can use the tool to learn exactly what their future income may be and to also help with financial planning. This can be especially beneficial for retirees for whom dividends from investments are a high portion of income.
Non-premium members will also be able to experience the new Dividend Payout Estimates Tool via the Free Credit initiative. Each month, Dividend.com will offer four credits to use on two of its premium tools. One can use
- 2 credits to reveal dividend payout estimates for two different tickers
- 2 credits to reveal Dividend.com Rating (previously called DARS) for 2 different tickers of choice. Here, investors can get a simple score to see if a stock is suitable for their portfolio.
In the end, Dividend.com’s new premium Payout Estimates feature is a must-have piece of tech for investors looking to plan for their future.
Be sure to visit our complete recommended list of the Best Dividend Stocks.
Dividend.com's Proprietary System
While you can glean some information about a singular stock’s or ETF’s future payouts simply by looking at its payout history, there’s much more to it than just that. Figuring out the various moving parts that help determine a firm’s future dividend is crucial, and that’s what Dividend.com has developed through its new Payout Estimates feature.
The logic behind the new feature is simple to understand and it also takes into account a variety of moving factors to help investors plan for their income needs.
For starters, the system provides payout estimates for securities with at least five consecutive payouts. This, firstly, eliminates new issuers and stocks that are just beginning their dividend journeys. Secondly, the system removes special dividends, as these tend to be one-off events. For ETFs and mutual funds, return of capital and capital gains distributions are not included as these are not considered “real” income sources and are solely determined based on the actions of fund managers and any annual changes to a fund’s holdings.
After selecting those stocks/funds with at least five consecutive payouts, the system will look at the variability of those dividends. If the last five payouts show limited variability and remain relatively consistent, the system estimates future payouts to be equal to the most recent one.
Any security that shows variability will have to be further reviewed to look at the growth rate of its payouts. For securities whose payouts show steady higher growth, the system estimates future payouts by applying the average growth rate to the most recent payout. For securities whose payouts are not showing growth, the system takes a conservative approach and estimates future payouts by applying the lowest growth to the most recent payout. This can include negative rates of growth and the tool estimates decreases in dividends.
Dates for future payouts are based on historical payment trends.
Finding the Payout Estimates Feature on Dividend.com
As of today, Dividend.com’s redesigned ticker pages will highlight this information and Premium members will be able to unlock the payout estimates for various securities. For example, take a look at tech-leader Apple (AAPL) and the screenshot of its ticker page.
In addition to free information such as market cap, current yield, price charts and Premium features like Dividend.com Rating, Apple’s ticker page will highlight the upcoming dividend payout using the new feature. This includes the estimated payout amount as well as the anticipated payout date.
Be sure to check our Dividend Screener to find out income securities of your choice.
Using Our New Feature
With Dividend.com’s new Premium feature, investors and their advisors have the ability to design a future-forward income plan, which is very important when either in retirement or in need of investment income to supplement other sources of pay.
Rather than simply focusing on previous payouts and blindly guessing about tomorrow, investors using Dividend.com’s latest Payout Estimates feature will have concrete evidence about their future income. Investors will no longer need to worry if they’ll have enough money to cover essential bills or if they can afford their golf course dues next month. Dividend.com’s new feature makes it easy to both plan and potentially make portfolio decisions to boost future income, if needed.
All in all, the new Payout Estimates feature is a must-have for investors. The proprietary system allows Dividend.com to predict future income potential for a variety of different securities. By using the easy-to-read prediction model, Premium users and their advisors can look forward rather than backward when it comes to income from their portfolios.
For more investment concepts, visit our Dividend Investing Ideas Center.