Analyzing JACK HENRY & ASSOCIATES INC (NASDAQ:JKHY)'s Dividend Potential.

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

Looking at the Dividend

An integral part of ChartMill's stock analysis is the Dividend Rating, which spans from 0 to 10. This rating evaluates diverse dividend factors, including yield, historical data, growth, and sustainability. JKHY has received a 7 out of 10:

• Compared to an average industry Dividend Yield of 4.92, JKHY pays a bit more dividend than its industry peers.
• On average, the dividend of JKHY grows each year by 6.79%, which is quite nice.
• 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.
• 39.57% of the earnings are spent on dividend by JKHY. This is a low number and sustainable payout ratio.
• JKHY's earnings are growing more than its dividend. This makes the dividend growth sustainable.

Understanding JKHY's Health

ChartMill assigns a proprietary Health Rating to each stock. The score is computed by evaluating various liquidity and solvency ratios and ranges from 0 to 10. JKHY was assigned a score of 8 for health:

• JKHY has an Altman-Z score of 10.89. This indicates that JKHY is financially healthy and has little risk of bankruptcy at the moment.
• JKHY has a Altman-Z score of 10.89. This is amongst the best in the industry. JKHY outperforms 97.03% of its industry peers.
• JKHY has a debt to FCF ratio of 0.51. This is a very positive value and a sign of high solvency as it would only need 0.51 years to pay back of all of its debts.
• Looking at the Debt to FCF ratio, with a value of 0.51, JKHY belongs to the top of the industry, outperforming 87.13% 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 84.16% of its industry peers.
• The Quick ratio of JKHY (1.17) is better than 61.39% of its industry peers.

Understanding JKHY's 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. JKHY has earned a 8 out of 10:

• JKHY has a better Return On Assets (13.92%) than 96.04% of its industry peers.
• JKHY has a Return On Equity of 20.51%. This is amongst the best in the industry. JKHY outperforms 84.16% of its industry peers.
• Looking at the Return On Invested Capital, with a value of 16.32%, JKHY belongs to the top of the industry, outperforming 92.08% of the companies in the same industry.
• JKHY had an Average Return On Invested Capital over the past 3 years of 17.33%. This is significantly above the industry average of 11.85%.
• JKHY has a better Profit Margin (17.82%) than 68.32% of its industry peers.
• With a decent Operating Margin value of 22.52%, JKHY is doing good in the industry, outperforming 66.34% of the companies in the same industry.
• With a decent Gross Margin value of 41.42%, JKHY is doing good in the industry, outperforming 64.36% of the companies in the same industry.

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 JKHY

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.