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GuruFocus has detected 3 Warning Signs with Marlin Business Services Corp $MRLN.
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Marlin Business Services Corp (NAS:MRLN)
5-Year Yield-on-Cost %
14.49 (As of Mar. 2017)

Marlin Business Services Corp's yield on cost for the quarter that ended in Mar. 2017 was 14.49.

MRLN' s 5-Year Yield-on-Cost % Range Over the Past 10 Years
Min: 2.5   Max: 25.7
Current: 14.49

2.5
25.7

During the past 13 years, Marlin Business Services Corp's highest Yield on Cost was 25.70. The lowest was 2.50. And the median was 14.76.

MRLN's 5-Year Yield-on-Cost % is ranked higher than
93% of the 2672 Companies
in the Global Specialty Finance industry.

( Industry Median: 3.41 vs. MRLN: 14.49 )

Definition

Dividend Yield and dividend growth of a stock is an important factor for income investors. But if company A raises its dividend constantly faster than company B, company A'’s future dividend yield might be much higher than Company B’'s even if their yields are the same now and their stock prices do not change.

Yield on Cost assumes that you buy and the stock today, and hold it for 5 years. If the company raises it dividends at the same rate as it did over the past 5 years, the dividends investors receive annually in 5 years relative to the stock price today.

Therefore, Yield-on-Cost of Marlin Business Services Corp is calculated as

Yield-on-Cost=Dividend Yield*(1+Dividend Growth Rate)^5

Explanation

Of course the risk here is that the company may not raise its dividends as it did before. The key is to select the companies that can consistently raise its dividends. Usually companies with long history of raising dividends tend to do so.


Related Terms

Dividend Yield

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