Why NASDAQ:DOX qualifies as a good dividend investing stock.

Last update: Dec 26, 2023

Consider AMDOCS LTD (NASDAQ:DOX) as a top pick for dividend investors, identified by our stock screening tool. NASDAQ:DOX shines in terms of profitability, solvency, and liquidity, all while paying a decent dividend. Let's dive deeper into the analysis.

Dividend Examination for NASDAQ:DOX

ChartMill assigns a proprietary Dividend Rating to each stock. The score is computed by evaluating various valuation aspects, like the yield, the history, the dividend growth and sustainability. NASDAQ:DOX was assigned a score of 7 for dividend:

Compared to an average industry Dividend Yield of 2.33, DOX pays a better dividend. On top of this DOX pays more dividend than 93.02% of the companies listed in the same industry.
On average, the dividend of DOX grows each year by 12.69%, which is quite nice.
DOX has been paying a dividend for at least 10 years, so it has a reliable track record.
DOX has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
28.55% of the earnings are spent on dividend by DOX. This is a low number and sustainable payout ratio.

Health Insights: NASDAQ:DOX

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NASDAQ:DOX scores a 6 out of 10:

DOX has an Altman-Z score of 5.03. This indicates that DOX is financially healthy and has little risk of bankruptcy at the moment.
DOX has a better Altman-Z score (5.03) than 79.07% of its industry peers.
DOX has a debt to FCF ratio of 1.10. This is a very positive value and a sign of high solvency as it would only need 1.10 years to pay back of all of its debts.
DOX has a Debt to FCF ratio of 1.10. This is amongst the best in the industry. DOX outperforms 82.56% of its industry peers.
DOX has a Debt/Equity ratio of 0.18. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of DOX (0.18) is better than 68.60% of its industry peers.

How do we evaluate the Profitability for NASDAQ:DOX?

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:DOX has earned a 7 out of 10:

With an excellent Return On Assets value of 10.49%, DOX belongs to the best of the industry, outperforming 84.88% of the companies in the same industry.
Looking at the Return On Equity, with a value of 19.01%, DOX belongs to the top of the industry, outperforming 82.56% of the companies in the same industry.
With an excellent Return On Invested Capital value of 14.59%, DOX belongs to the best of the industry, outperforming 87.21% of the companies in the same industry.
The last Return On Invested Capital (14.59%) for DOX is above the 3 year average (10.11%), which is a sign of increasing profitability.
Looking at the Profit Margin, with a value of 11.44%, DOX belongs to the top of the industry, outperforming 87.21% of the companies in the same industry.
The Operating Margin of DOX (14.77%) is better than 80.23% of its industry peers.
DOX's Operating Margin has improved in the last couple of years.

Our Best Dividend screener lists more Best Dividend stocks and is updated daily.

For an up to date full fundamental analysis you can check the fundamental report of DOX

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.