Is NYSE:WST a Good Fit for Dividend Investing?

Last update: Aug 21, 2024

WEST PHARMACEUTICAL SERVICES (NYSE:WST) has caught the attention of dividend investors as a stock worth considering. NYSE:WST excels in profitability, solvency, and liquidity, all while providing a decent dividend. Let's delve into the details.

Unpacking NYSE:WST's Dividend Rating

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:WST has achieved a 7 out of 10:

Compared to an average industry Dividend Yield of 0.62, WST pays a better dividend. On top of this WST pays more dividend than 87.72% of the companies listed in the same industry.
On average, the dividend of WST grows each year by 6.31%, which is quite nice.
WST has paid a dividend for at least 10 years, which is a reliable track record.
WST has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
WST pays out 11.07% of its income as dividend. This is a sustainable payout ratio.
The dividend of WST is growing, but earnings are growing more, so the dividend growth is sustainable.

Health Examination for NYSE:WST

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. NYSE:WST scores a 8 out of 10:

An Altman-Z score of 17.51 indicates that WST is not in any danger for bankruptcy at the moment.
WST has a Altman-Z score of 17.51. This is amongst the best in the industry. WST outperforms 100.00% of its industry peers.
WST has a debt to FCF ratio of 0.59. This is a very positive value and a sign of high solvency as it would only need 0.59 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 0.59, WST belongs to the best of the industry, outperforming 92.98% of the companies in the same industry.
A Debt/Equity ratio of 0.03 indicates that WST is not too dependend on debt financing.
WST has a Debt to Equity ratio of 0.03. This is in the better half of the industry: WST outperforms 70.18% of its industry peers.
A Current Ratio of 2.34 indicates that WST has no problem at all paying its short term obligations.

What does the Profitability looks like for NYSE:WST

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:WST, the assigned 8 is noteworthy for profitability:

With an excellent Return On Assets value of 15.04%, WST belongs to the best of the industry, outperforming 96.49% of the companies in the same industry.
WST has a better Return On Equity (20.37%) than 94.74% of its industry peers.
Looking at the Return On Invested Capital, with a value of 17.43%, WST belongs to the top of the industry, outperforming 94.74% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for WST is significantly above the industry average of 11.16%.
WST has a Profit Margin of 18.25%. This is amongst the best in the industry. WST outperforms 92.98% of its industry peers.
WST's Profit Margin has improved in the last couple of years.
The Operating Margin of WST (20.99%) is better than 89.47% of its industry peers.
WST's Operating Margin has improved in the last couple of years.
In the last couple of years the Gross Margin of WST has grown nicely.

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Check the latest full fundamental report of WST for a complete fundamental analysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.