Why NASDAQ:JKHY is a Top Pick for Dividend Investors.

JACK HENRY & ASSOCIATES INC (NASDAQ:JKHY) has caught the attention of dividend investors as a stock worth considering. NASDAQ:JKHY excels in profitability, solvency, and liquidity, all while providing a decent dividend. Let's delve into the details.

Assessing Dividend for NASDAQ:JKHY

ChartMill assigns a Dividend Rating to every stock. This score ranges from 0 to 10 and evaluates the different dividend aspects, including the yield, the growth and sustainability. NASDAQ:JKHY scores a 7 out of 10:

• JKHY's Dividend Yield is a higher than the industry average which is at 3.84.
• On average, the dividend of JKHY grows each year by 6.79%, which is quite nice.
• JKHY has paid a dividend for at least 10 years, which is a reliable track record.
• JKHY has not decreased their dividend for at least 10 years, which is a reliable track record.
• JKHY pays out 39.59% of its income as dividend. This is a sustainable payout ratio.
• JKHY's earnings are growing more than its dividend. This makes the dividend growth sustainable.

Understanding NASDAQ:JKHY's Health Score

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:JKHY has earned a 9 out of 10:

• JKHY has an Altman-Z score of 10.42. This indicates that JKHY is financially healthy and has little risk of bankruptcy at the moment.
• The Altman-Z score of JKHY (10.42) is better than 94.12% 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 87.25% of the companies in the same industry.
• A Debt/Equity ratio of 0.03 indicates that JKHY is not too dependend on debt financing.
• JKHY's Debt to Equity ratio of 0.03 is amongst the best of the industry. JKHY outperforms 86.27% of its industry peers.
• JKHY does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

Looking at the Profitability

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:JKHY has earned a 8 out of 10:

• JKHY has a better Return On Assets (13.64%) than 95.10% of its industry peers.
• JKHY has a better Return On Equity (20.74%) than 85.29% of its industry peers.
• JKHY has a Return On Invested Capital of 16.58%. This is amongst the best in the industry. JKHY outperforms 93.14% of its industry peers.
• JKHY had an Average Return On Invested Capital over the past 3 years of 17.33%. This is significantly above the industry average of 7.84%.
• JKHY has a Profit Margin of 17.79%. This is in the better half of the industry: JKHY outperforms 69.61% of its industry peers.
• Looking at the Operating Margin, with a value of 22.63%, JKHY is in the better half of the industry, outperforming 67.65% of the companies in the same industry.
• Looking at the Gross Margin, with a value of 41.21%, JKHY is in the better half of the industry, outperforming 63.73% 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 JKHY

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.