HUBBELL INC (NYSE:HUBB): A Top Dividend Stock with Strong Growth and Financial Health

Dividend investors often look for a mix of yield, sustainability, and financial health when choosing stocks. One way to find such opportunities is by using a dividend-focused stock screener that picks companies with strong dividend ratings while keeping solid profitability and financial stability. The "Best Dividend Stocks" screen on ChartMill, for example, selects stocks with a ChartMill Dividend Rating of 7 or higher, making sure they meet strict standards for dividend reliability, growth, and payout sustainability. The screen also requires a minimum Profitability Rating of 5 and a Health Rating of 5 or above, ensuring the companies are financially stable and able to keep up their payouts over time.

HUBBELL INC (NYSE:HUBB) stands out as a strong pick from this screening process. The company, which designs and makes electrical and electronic products for industrial and utility uses, shows several traits that match the goals of dividend-focused investors.

Key Dividend Strengths of HUBB

• Steady Dividend Growth: HUBB has regularly raised its dividend, with an annual growth rate of 7.79% in recent years. This consistent growth shows management’s focus on rewarding shareholders while keeping financial flexibility.
• Long History of Payments: The company has paid dividends for at least 10 straight years without cutting them, proving its reliability as a dividend payer.
• Sustainable Payout Ratio: HUBB’s dividend payout ratio is 33.45% of earnings, well below levels that might suggest financial stress. This leaves plenty of room for reinvestment in the business while still paying shareholders.

Profitability and Financial Health Support Dividend Sustainability

A strong dividend depends on the company’s ability to maintain it, and HUBB performs well here too:

• Strong Profitability Metrics: The company has a Return on Invested Capital (ROIC) of 15.81%, beating 95.7% of its industry peers. Its Operating Margin of 20.35% is also among the best in the sector, showing efficient operations and strong pricing power.
• Healthy Balance Sheet: HUBB keeps a Debt-to-Equity ratio of 0.42, reflecting a cautious capital structure. Its Altman-Z score of 5.94 suggests low bankruptcy risk, giving investors more confidence in its financial stability.

Valuation and Growth Considerations

While HUBB’s P/E ratio of 25.39 is slightly below the industry average, its strong profitability and dividend reliability may support the valuation. Analysts predict EPS growth of 8.34% per year in the coming years, which could lead to more dividend increases.

For a closer look at HUBB’s fundamentals, you can check the full Fundamental Analysis Report.

Finding More Dividend Opportunities

HUBB is just one of many stocks that fit the criteria for reliable dividend payers. Investors searching for more ideas can use the Best Dividend Stocks screener, which offers a list of high-quality dividend stocks with strong fundamentals.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should do their own research or consult a financial advisor before making investment decisions.