June 22, 2025 a 02:46 am
JKHY: Dividend Analysis - Jack Henry & Associates, Inc.
Jack Henry & Associates, Inc. (JKHY) boasts a resilient dividend profile with a commendable history of 36 consecutive years of dividend payments. As a leader in its sector, JKHY has consistently demonstrated a commitment to rewarding shareholders, evident through its moderate but steady dividend growth. This enduring stability, combined with a conservative payout ratio, underlines the company's strategic intent to maintain and potentially enhance shareholder value over the long run.
📊 Overview
As a respected entity within the technology sector, Jack Henry & Associates, Inc. offers shareholders an appealing dividend yield of 1.25%, highlighting its capacity for incremental income generation. With a current dividend per share of 2.14 USD and an uninterrupted dividend history spanning 36 years, the firm stands out for its commendable dividend track record.
| Category | Detail |
|---|---|
| Sector | Technology |
| Dividend yield | 1.25% |
| Current dividend per share | 2.14 USD |
| Dividend history | 36 years |
| Last cut or suspension | None |
🗣️ Dividend History
The robust dividend history of JKHY underscores its steadfast commitment to shareholders. A strong history of payments enhances investment appeal, acting as a beacon of financial discipline and growth potential.
| Year | Dividend Per Share (USD) |
|---|---|
| 2025 | 1.16 |
| 2024 | 2.20 |
| 2023 | 2.08 |
| 2022 | 1.96 |
| 2021 | 1.84 |
📈 Dividend Growth
An analysis of JKHY's dividend growth reveals a disciplined approach, with a 3-year growth rate of approximately 6.1% and a 5-year growth of about 6.6%. This growth reflects strategic reinvestment and careful capital management.
| Time | Growth |
|---|---|
| 3 years | 6.14% |
| 5 years | 6.58% |
The average dividend growth is 6.58% over 5 years. This shows moderate but steady dividend growth.
⚠️ Payout Ratio
A key metric to assess dividend sustainability, the EPS-based payout ratio stands at approximately 36.29% while the free cash flow-based ratio is 51.46%. These figures reflect prudent management, ensuring that dividends are comfortably covered by earnings and cash flow.
| Key figure ratio | Value |
|---|---|
| EPS-based | 36.29% |
| Free cash flow-based | 51.46% |
The EPS and FCF payout ratios indicate a sustainable dividend policy that balances shareholder returns with reinvestment needs.
✅ Cashflow & Capital Efficiency
Analyzing JKHY's cash flow and capital efficiency reveals a robust financial structure. With a CAPEX to operating cash flow well below 50%, the company retains ample room for innovation and strategic investments.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 2.82% | 1.43% | 2.39% |
| Earnings Yield | 3.21% | 3.01% | 2.77% |
| CAPEX to Operating Cash Flow | 40.92% | 54.25% | 37.93% |
| Stock-based Compensation to Revenue | 1.30% | 1.38% | 1.28% |
| Free Cash Flow / Operating Cash Flow Ratio | 59.08% | 45.75% | 62.07% |
The company's efficient capital utilization and strong cash generation underpin its strategic flexibility to pursue growth initiatives while maintaining dividend stability.
✅ Balance Sheet & Leverage Analysis
A comparative analysis of JKHY's balance sheet indicates strong financial stability. Low leverage ratios illustrate conservative debt management, enhancing financial resilience.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 11.38% | 17.10% | 8.33% |
| Debt-to-Assets | 7.17% | 9.91% | 4.69% |
| Debt-to-Capital | 10.21% | 14.60% | 7.69% |
| Net Debt to EBITDA | 0.24 | 0.39 | 0.10 |
| Current Ratio | 0.00 | 1.57 | 1.13 |
| Quick Ratio | 0.00 | 1.57 | 1.13 |
| Financial Leverage | 1.59 | 1.72 | 1.78 |
JKHY's balance sheet reflects prudent debt usage, which enhances its capacity to withstand market volatility and pursue growth opportunities without substantial financial strain.
✅ Fundamental Strength & Profitability
The company's fundamental metrics highlight robust profitability, with margins and returns well above industry averages, reflecting effective management and strategic advantage.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 20.72% | 22.79% | 26.27% |
| Return on Assets | 13.06% | 13.22% | 14.78% |
| Margins: Net | 17.23% | 17.65% | 18.68% |
| Margins: EBIT | 23.22% | 23.56% | 24.43% |
| Margins: EBITDA | 32.24% | 32.75% | 33.57% |
| Research & Development to Revenue | 6.69% | 6.87% | 6.25% |
The solid profitability metrics signify JKHY's effective resource utilization and competitive edge in the market, supporting its ability to sustain and grow dividend payouts.
📉 Price Development
✅ Dividend Scoring System
| Criteria | Score | Score Bar |
|---|---|---|
| Dividend yield | 4 | |
| Dividend Stability | 5 | |
| Dividend growth | 4 | |
| Payout ratio | 5 | |
| Financial stability | 5 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 5 |
Total Score: 37/40
✅ Rating
In conclusion, Jack Henry & Associates, Inc. exhibits a commendable dividend profile backed by robust fundamentals and financial stability. Investors seeking reliable dividend income combined with growth potential should find JKHY an attractive addition to their portfolio. Its conservative dividend policy and solid growth metrics extend an expectation for continued shareholder value accretion.