Is NYSE:HUBB suited for dividend investing?

Last update: Dec 27, 2023

Our stock screening tool has identified HUBBELL INC (NYSE:HUBB) as a strong dividend contender with robust fundamentals. NYSE:HUBB exhibits commendable financial health and profitability, all while offering a sustainable dividend. Let's delve into each aspect below.

Exploring NYSE:HUBB's Dividend

To gauge a stock's dividend quality, ChartMill utilizes a Dividend Rating ranging from 0 to 10. This comprehensive assessment considers various dividend aspects, including yield, history, growth, and sustainability. NYSE:HUBB has achieved a 7 out of 10:

Compared to an average industry Dividend Yield of 2.41, HUBB pays a better dividend. On top of this HUBB pays more dividend than 91.86% of the companies listed in the same industry.
The dividend of HUBB is nicely growing with an annual growth rate of 8.25%!
HUBB has paid a dividend for at least 10 years, which is a reliable track record.
HUBB has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
34.71% of the earnings are spent on dividend by HUBB. This is a low number and sustainable payout ratio.
The dividend of HUBB is growing, but earnings are growing more, so the dividend growth is sustainable.

Evaluating Health: NYSE:HUBB

Every stock is evaluated by ChartMill, receiving a Health Rating on a scale of 0 to 10. This assessment considers different health aspects, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:HUBB has achieved a 7 out of 10:

HUBB has an Altman-Z score of 5.97. This indicates that HUBB is financially healthy and has little risk of bankruptcy at the moment.
HUBB's Altman-Z score of 5.97 is amongst the best of the industry. HUBB outperforms 88.37% of its industry peers.
HUBB has a debt to FCF ratio of 2.37. This is a good value and a sign of high solvency as HUBB would need 2.37 years to pay back of all of its debts.
HUBB has a better Debt to FCF ratio (2.37) than 84.88% of its industry peers.
Although HUBB does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
HUBB has a Current Ratio of 2.16. This indicates that HUBB is financially healthy and has no problem in meeting its short term obligations.

Profitability Insights: NYSE:HUBB

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:HUBB was assigned a score of 9 for profitability:

With an excellent Return On Assets value of 11.99%, HUBB belongs to the best of the industry, outperforming 90.70% of the companies in the same industry.
With an excellent Return On Equity value of 25.25%, HUBB belongs to the best of the industry, outperforming 91.86% of the companies in the same industry.
HUBB has a Return On Invested Capital of 16.77%. This is amongst the best in the industry. HUBB outperforms 95.35% of its industry peers.
The last Return On Invested Capital (16.77%) for HUBB is above the 3 year average (10.99%), which is a sign of increasing profitability.
The Profit Margin of HUBB (13.18%) is better than 88.37% of its industry peers.
HUBB's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 18.85%, HUBB belongs to the top of the industry, outperforming 94.19% of the companies in the same industry.
Looking at the Gross Margin, with a value of 34.39%, HUBB belongs to the top of the industry, outperforming 80.23% of the companies in the same industry.

More Best Dividend stocks can be found in our Best Dividend screener.

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

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.