Bristol-Myers Squibb Co (NYSE:BMY) Offers a High-Quality Dividend Profile for Income Investors

For investors aiming to build a portfolio that creates steady passive income, a systematic screening method is important. One useful technique involves selecting for companies that provide a good dividend now and also have the basic financial soundness to maintain and possibly raise those payments. This plan often centers on stocks with a high total dividend rating, which looks at yield, growth, and reliability, while also checking the company keeps satisfactory scores for earnings and balance sheet condition. This layered method helps sidestep high-yield stocks that could be hiding basic business problems.

Bristol-Myers Squibb Co (NYSE:BMY) appears as a candidate from this kind of screening process, presenting a profile that justifies a more detailed review for income-focused investors.

A Noteworthy Dividend Profile

The central point of BMY's appeal for dividend investors is its solid and respected payout. The company's dividend profile receives good marks on several important measures that are key for a lasting income plan.

• Good Yield: BMY currently provides a yearly dividend yield near 4.92%. This is much higher than the average yield for the S&P 500 (near 1.87%) and is notable within its pharmaceuticals industry group.
• Dependable Growth Record: The company has built a history of not just paying, but regularly raising its dividend. BMY has increased its payout for at least ten straight years, with a notable annualized growth rate close to 11.67% over the past five years. This record of growth is a key sign of management's dedication to giving capital back to shareholders.
• High Dividend Rating: These elements lead to BMY receiving a high ChartMill Dividend Rating. This rating combines yield, growth, and reliability measures, giving a single, full score that confirms the stock's quality from an income viewpoint.

Basic Financial Soundness: Earnings and Condition

A high dividend is only as reliable as the company's capacity to pay for it. This is where selecting for satisfactory earnings and balance sheet condition shows its value, and BMY's profile gives supporting facts.

Earnings are a definite positive. The company has very good margins, with an operating margin above 33% that beats most of its industry. Its return on invested capital (ROIC) is also good, showing efficient use of capital to create profits. This high level of earnings is the source that pays for the dividend and its increase. A company with low margins would find it hard to keep, or raise, shareholder payments over many years.

Balance Sheet Condition shows a more varied but adequate picture, fitting the "satisfactory" level used in the screening plan. On the good side, BMY creates large cash flow, with a sound debt-to-free-cash-flow ratio indicating it could reduce its debts fairly fast. Still, investors should be aware the company holds a large amount of debt, which is typical in industries like pharmaceuticals that require much capital. The screen for a minimum condition rating helps confirm that, while not ideal, the company's overall stability and cash availability are not at immediate risk, giving some protection for the dividend during weaker economic periods.

Price and Growth Setting

From a price perspective, BMY seems fairly valued. Its price-to-earnings ratio is low compared to the wider market and its industry, possibly giving some safety for investors. Looking forward, analyst forecasts predict good growth in earnings per share, which could further back the dividend. However, it is key to weigh this against the forecast of a small drop in revenue, pointing to the significance of the company's continuing product development and cost control.

For a complete look at all these basic factors, you can see the full ChartMill Fundamental Analysis Report for BMY.

Is BMY Suitable for a Dividend Portfolio?

Bristol-Myers Squibb shows the kind of company a systematic dividend screening process tries to find. It combines a good, increasing yield with the basic earnings required to support it, while keeping a balance sheet condition that indicates stability. For investors whose plan focuses on lasting income, BMY's mix of a high dividend rating, good earnings, and fair price makes it a notable candidate for more study.

This review of BMY came from a methodical screen for high-quality dividend payers. If you want to examine other stocks that fit similar standards for strong dividends, firm earnings, and satisfactory balance sheet condition, you can use the same screen. Click here to see and adjust the "Best Dividend Stocks" screen for more possible ideas.

,

Disclaimer: This article is for informational and educational purposes only and does not constitute financial advice, a recommendation, or an offer or solicitation to buy or sell any securities. The information presented is based on data provided and should not be the sole basis for any investment decision. Investors should conduct their own independent research and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results.