Hancock Whitney (HWC) Could Be a Great Choice

Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.

While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.

Based in Gulfport, Hancock Whitney (HWC) is in the Finance sector, and so far this year, shares have seen a price change of 2.34%. The holding company of Whitney Bank and Hancock Bank is paying out a dividend of $0.50 per share at the moment, with a dividend yield of 3.07% compared to the Banks - Southeast industry's yield of 2.12% and the S&P 500's yield of 1.47%.

Looking at dividend growth, the company's current annualized dividend of $2.00 is up 11.1% from last year. Over the last 5 years, Hancock Whitney has increased its dividend 3 times on a year-over-year basis for an average annual increase of 11.55%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Hancock Whitney's current payout ratio is 31%, meaning it paid out 31% of its trailing 12-month EPS as dividend.

Looking at this fiscal year, HWC expects solid earnings growth. The Zacks Consensus Estimate for 2026 is $6.30 per share, representing a year-over-year earnings growth rate of 10.14%.

Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. But, not every company offers a quarterly payout.

For instance, it's a rare occurrence when a tech start-up or big growth business offers its shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. That said, they can take comfort from the fact that HWC is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).

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This article originally published on Zacks Investment Research (zacks.com).

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