Old Republic International Co (ORI)

[FUNMAN]

Here's What We Like About Old Republic International's (NYSE:ORI) Upcoming Dividend

Simply Wall St
Fri, September 10, 2021, 7:24 AM·3 min read

https://finance.yahoo.com/news/heres-old-republic-internationals-nyse-112420504.html

Old Republic International Corporation (NYSE:ORI) is about to trade ex-dividend in the next 3 days. Typically, the ex-dividend date is one business day before the record date which is the date on which a company determines the shareholders eligible to receive a dividend. The ex-dividend date is of consequence because whenever a stock is bought or sold, the trade takes at least two business day to settle. Accordingly, Old Republic International investors that purchase the stock on or after the 14th of September will not receive the dividend, which will be paid on the 6th of October.

The company's next dividend payment will be US$1.50 per share, on the back of last year when the company paid a total of US$2.38 to shareholders. Calculating the last year's worth of payments shows that Old Republic International has a trailing yield of 9.4% on the current share price of $25.36. If you buy this business for its dividend, you should have an idea of whether Old Republic International's dividend is reliable and sustainable. As a result, readers should always check whether Old Republic International has been able to grow its dividends, or if the dividend might be cut.

Check out our latest analysis for Old Republic International

https://simplywall.st/stocks/us/insurance/nyse-ori/old-republic-international?blueprint=1739856&utm_medium=finance_user&utm_campaign=cta&utm_source=yahoo

Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. Old Republic International has a low and conservative payout ratio of just 16% of its income after tax.

When a company paid out less in dividends than it earned in profit, this generally suggests its dividend is affordable. The lower the % of its profit that it pays out, the greater the margin of safety for the dividend if the business enters a downturn.

Click here to see the company's payout ratio, plus analyst estimates of its future dividends.

https://simplywall.st/stocks/us/insurance/nyse-ori/old-republic-international?blueprint=1739856&utm_medium=finance_user&utm_campaign=integrated-pitch&utm_source=yahoo#current-dividend-payout

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. That's why it's comforting to see Old Republic International's earnings have been skyrocketing, up 27% per annum for the past five years.

Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Old Republic International has delivered 13% dividend growth per year on average over the past 10 years. It's great to see earnings per share growing rapidly over several years, and dividends per share growing right along with it.

Final Takeaway

Is Old Republic International an attractive dividend stock, or better left on the shelf? Typically, companies that are growing rapidly and paying out a low fraction of earnings are keeping the profits for reinvestment in the business. This strategy can add significant value to shareholders over the long term - as long as it's done without issuing too many new shares. Overall, Old Republic International looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.

In light of that, while Old Republic International has an appealing dividend, it's worth knowing the risks involved with this stock. Every company has risks, and we've spotted 1 warning sign for Old Republic International you should know about.

https://simplywall.st/stocks/us/insurance/nyse-ori/old-republic-international?blueprint=1739856&utm_medium=finance_user&utm_campaign=conclusion&utm_source=yahoo#executive-summary

A common investment mistake is buying the first interesting stock you see. Here you can find a list of promising dividend stocks with a greater than 2% yield and an upcoming dividend.

https://simplywall.st/discover/investing-ideas/23485/great-dividend-ideas/us?blueprint=1739856&utm_campaign=conclusion-grid&utm_medium=finance_user&utm_source=yahoo

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.