Baker Hughes Co (NASDAQ:BKR): A Steady Dividend Stock with Sound Finances

For investors looking for steady income from dividend stocks, a methodical screening process can find companies that mix good yields with sound finances. One useful technique uses filters for stocks with good dividend scores while keeping enough profit and condition measures. This method helps prevent the frequent mistake of pursuing high-yield stocks that could have hidden money problems. By choosing minimum levels for dividend grade, profit, and financial condition, investors can make a list of companies able to keep their dividend payouts during different market situations.

Dividend Profile Analysis

Baker Hughes Co (NASDAQ:BKR) offers a good option for dividend investors, getting a ChartMill Dividend Rating of 7 out of 10. The company's dividend features show both steadiness and the ability to continue, which are important for investors focused on income.

Important dividend measures are:

• Current dividend yield of 1.95%, a bit under the industry average but similar to S&P500 levels
• Ten-year history of steady dividend payments with no cuts
• Maintainable payout ratio of 30.82% of earnings
• Dividend growth rate of 4.36% per year

The quite low payout ratio is especially important since it shows the company keeps enough earnings to put back into business activities while continuing dividend payments. This mix between shareholder returns and business spending is needed for long-term dividend continuation.

Profitability Assessment

Baker Hughes shows good operational results with a ChartMill Profitability Rating of 8. The company's return measures do much better than industry competitors, giving a good base for ongoing dividend payments.

Profitability main points:

• Return on Equity of 15.92%, doing better than 83% of industry rivals
• Return on Invested Capital of 11.19%, higher than 81% of peers
• Profit margin of 10.43%, superior to 82% of industry firms
• Steady margin betterment over recent years

These good profit measures are important for dividend investors since they show the company makes enough earnings to support both present activities and shareholder payouts. Good and bettering margins suggest the company keeps competitive benefits in its market place.

Financial Health Evaluation

With a ChartMill Health Rating of 5, Baker Hughes keeps acceptable financial steadiness, though some parts need watching. The company's balance sheet shows sensible debt handling but has some cash availability points.

Financial condition signs:

• Debt-to-Equity ratio of 0.33, showing a balanced capital setup
• Current ratio of 1.41, giving short-term bill coverage
• Altman-Z score of 2.36, putting the company in a steady risk group
• Positive free cash flow creation helping debt payment ability

While the company's cash availability ratios are behind some industry peers, the total financial condition is enough to support current dividend payments. The workable debt amounts and steady cash flow creation give confidence about the company's ability to keep its dividend promise.

Growth Path and Valuation

Baker Hughes displays medium growth chances with some slowing in future outlooks. The company's price seems somewhat high next to some industry measures, though this might show its good profit profile.

Growth and price thoughts:

• Past EPS growth of 23.35% per year over recent years
• Expected future EPS growth of 8.42%
• P/E ratio of 19.00, a little under the industry average
• Forward P/E of 17.97, matching sector peers

The expected growth reduction needs notice, though the kept positive growth path should support continued dividend rises. The price premium seems reasonable considering the company's better profit measures and dividend steadiness.

Investment Thoughts

For dividend-focused investors, Baker Hughes stands for a mixed chance giving steady income with medium growth possibility. The company's ten-year dividend steadiness, maintainable payout ratio, and good profit make a base for continued income creation. While the present yield might not interest those seeking the highest yields, the mix of yield, growth, and safety shows an interesting profile for careful dividend investors.

The company's place in the energy services field gives contact to global energy infrastructure spending, possibly gaining from long-term energy shift patterns. Investors should watch industry cycles and the company's ability to keep its competitive place.

For investors looking for more dividend stock ideas using like screening rules, see the Best Dividend Stocks screen which finds companies with good dividend features together with sound profit and financial condition.

Disclaimer: This study is based on fundamental data and screening rules for information only. It is not investment advice, and investors should do their own research and think about their personal money situation before making investment choices. Past results and present measures do not ensure future outcomes.