Why the dividend investor may take a look at NASDAQ:JKHY.

Last update: Jan 9, 2025

Our stock screener has spotted JACK HENRY & ASSOCIATES INC (NASDAQ:JKHY) as a good dividend stock with solid fundamentals. NASDAQ:JKHY shows decent health and profitability. At the same time it gives a good and sustainable dividend. We'll dive into each aspect below.

A Closer Look at Dividend for NASDAQ:JKHY

ChartMill assigns a Dividend Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing various dividend elements, such as yield, historical performance, dividend growth, and sustainability. NASDAQ:JKHY has been awarded a 7 for its dividend quality:

JKHY's Dividend Yield is a higher than the industry average which is at 3.95.
The dividend of JKHY is nicely growing with an annual growth rate of 6.79%!
JKHY has been paying a dividend for at least 10 years, so it has a reliable track record.
JKHY has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
39.59% of the earnings are spent on dividend by JKHY. This is a low number and sustainable payout ratio.
The dividend of JKHY is growing, but earnings are growing more, so the dividend growth is sustainable.

Health Assessment of NASDAQ:JKHY

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:JKHY has received a 9 out of 10:

An Altman-Z score of 10.44 indicates that JKHY is not in any danger for bankruptcy at the moment.
JKHY has a better Altman-Z score (10.44) than 93.94% of its industry peers.
The Debt to FCF ratio of JKHY is 0.48, which is an excellent value as it means it would take JKHY, only 0.48 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 0.48, JKHY belongs to the top of the industry, outperforming 86.87% of the companies in the same industry.
A Debt/Equity ratio of 0.03 indicates that JKHY is not too dependend on debt financing.
The Debt to Equity ratio of JKHY (0.03) is better than 85.86% of its industry peers.
The current and quick ratio evaluation for JKHY is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

Assessing Profitability for NASDAQ:JKHY

Discover ChartMill's exclusive Profitability Rating, a proprietary metric that assesses stocks on a scale of 0 to 10. It takes into consideration various profitability ratios and margins, both in absolute terms and relative to industry peers. Notably, NASDAQ:JKHY has achieved a 8:

JKHY has a Return On Assets of 13.64%. This is amongst the best in the industry. JKHY outperforms 94.95% of its industry peers.
The Return On Equity of JKHY (20.74%) is better than 84.85% of its industry peers.
Looking at the Return On Invested Capital, with a value of 16.58%, JKHY belongs to the top of the industry, outperforming 92.93% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for JKHY is significantly above the industry average of 7.84%.
With a decent Profit Margin value of 17.79%, JKHY is doing good in the industry, outperforming 68.69% of the companies in the same industry.
JKHY has a better Operating Margin (22.63%) than 66.67% of its industry peers.
JKHY has a better Gross Margin (41.21%) than 64.65% of its industry peers.

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 JKHY

Disclaimer

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.