Are You Looking for a High-Growth Dividend Stock?

Korn/Ferry (KFY) is highlighted as a compelling dividend opportunity, offering a 2.97% yield that significantly exceeds its industry average and the S&P 500. The staffing firm has demonstrated strong dividend growth, with its annualized payout of $1.92 up 20.8% year-over-year and an average annual increase of 40.80% over the past five years. This is supported by a sustainable 38% payout ratio and projected 5.94% EPS growth for 2025, with the stock currently holding a Zacks Rank of #3 (Hold).

Analysis

Korn/Ferry (KFY) presents a compelling profile for income-focused investors, currently offering a dividend yield of 2.97%. This significantly surpasses the Staffing Firms industry average of 1.71% and the S&P 500's 1.51%, despite the stock experiencing a -4.08% price change year-to-date.

The company demonstrates robust dividend growth, with its current annualized dividend of $1.92 representing a 20.8% increase from last year. Over the past five years, KFY has raised its dividend four times, achieving an impressive average annual increase of 40.80%. This growth is supported by a sustainable payout ratio of 38% of its trailing 12-month EPS.

Future dividend sustainability is bolstered by a positive earnings outlook. The Zacks Consensus Estimate projects KFY's 2025 EPS at $5.17, indicating a year-over-year growth rate of 5.94%. The stock currently holds a Zacks Rank of #3 (Hold), suggesting a balanced near-term outlook.

Key Decisions for Investors

• Investors should consider KFY for income-oriented portfolios given its superior dividend yield and robust growth history.
• Monitor the company's projected 5.94% EPS growth for 2025 as a critical factor for sustaining future dividend increases.
• Be mindful of the general market sensitivity of high-yielding stocks to rising interest rates, and factor in the current Zacks Rank #3 (Hold) when assessing near-term prospects.