JACK HENRY & ASSOCIATES INC (NASDAQ:JKHY) - A Reliable Dividend Stock with Strong Fundamentals

JACK HENRY & ASSOCIATES INC (NASDAQ:JKHY) was identified as a high-quality dividend stock through our screening process. The company combines a solid dividend track record with strong profitability and financial health, making it an interesting candidate for income-focused investors. Below, we examine why JKHY stands out.

Dividend Strength

• Consistent Payouts: JKHY has paid dividends for at least 10 years without reductions, demonstrating reliability.
• Growing Dividends: The company has increased its dividend at an average annual rate of 6.79%, indicating a commitment to shareholder returns.
• Sustainable Payout Ratio: Only 37.87% of earnings are allocated to dividends, leaving ample room for reinvestment and future growth.

Profitability & Financial Health

• High Profit Margins: JKHY maintains an 18.50% profit margin, outperforming 74.26% of its industry peers.
• Strong Balance Sheet: With a low debt-to-equity ratio of 0.04 and an Altman-Z score of 12.12, the company is financially stable.
• Efficient Capital Use: A return on invested capital (ROIC) of 16.61% highlights effective management.

Valuation Considerations

While JKHY trades at a premium with a P/E ratio of 31.69, its strong fundamentals and dividend growth may justify the valuation for long-term investors.

For a deeper analysis, review the full fundamental report on JKHY.

Our Best Dividend Stocks screener provides more high-quality dividend ideas.

Disclaimer

This is not investment advice. Always conduct your own research before making investment decisions.