WestRock (WRK) A Dividend Stock Comeback Story

PUBLISHED Nov 16, 2022, 5:18:00 PM        SHARE

imgDividend Diplomats Blog

WestRock Logo

Yes, this is a random WestRock (WRK) dividend stock, come back story. Why is it a comeback? WestRock decimated their dividend during the height of the pandemic from COVID-19. One of the world’s biggest, packaging companies reduced their dividend to $0.20 per share, per quarter from the high of $0.465.

WestRock reduced their dividend 2.5 years ago. Therefore, 2.5 years have gone by and they just recorded record revenue for their 4th quarter sale. Now that it appears they’ve been cruising along during this potential recession, how does this stock look, now? Is WestRock saying, “Don’t call it a comeback!”

Westrock – the set back

Given the mass amount of packaging material that was used during the pandemic (think – take out, grocery products/items, pizza – of course), it came as a shock when WestRock reduced their dividend. The cut it by MORE than half, going from $0.465 to $0.20 per hare, per quarter. A 57% cut is fairly steep if you ask me.

WestRock Headline

The investing community at the time did not think they needed to do it, either. They used the reason to pay down debt, which is great long-term and I am completely okay with. WestRock wanted to be flexible and fluid during a turbulent time period. WestRock did satisfy their goal, going from well over $9 billion in long-term deb to now, at the time of this writing, $7.5 billion in long-term debt.

After the news, this sent the stock tumbling way down to the $23-$24 range.

Westrock price chart

As you can see, the stock is up 50% truly since the pandemic and is down approximately 14%-15% this year. However, that is just noise. WestRock (WRK) may, JUST MAY be setting themselves up for a brilliant comeback, as performance appears to be firing away, record revenue, increasing profits and… dividend payouts baby!

Westrock’s come back performance

Not only are they making a resurgence of their dividend, their performance has been nothing short but stellar.

On their latest earnings release –> See here , WestRock recorded over $5.4 billion of revenue, up from $5.1 billion the same period last year. Net income was also up over $20 million.

On top of that, they’ve been buying back a ton of shares outstanding. WestRock went from 269 million shares from September last year, down to 256 million shares. The massive packaging company bought back almost 5% of their shares over a 12 month period.

Westrock financials

Therefore, and partly because of that, earnings per share for WestRock blossomed up to $1.34 from $1.20. I don’t care what anyone says, net income going up 11% for a company in the packaging business is phenomenal! That’s a helluva lot of pizza, I know I’ve been a contributor to that!

Okay, now let’s dive in to what you are here for – the dividend stock metrics through – the Dividend Diplomat Stock Screener baby!

Westrock dividend stock metrics

WestRock you are going through the Dividend Diplomat Stock Screener! Here, we focus on 3 main dividend stock metrics:

1.) Price to Earnings Ratio (P/E): We look for the price to earnings ratio < the S&P 500 and the competition.

2.) Dividend Payout Ratio: The preferred dividend payout ratio is < 60%. In fact, we believe the perfect payout ratio is between 40% and 60%.

3.) Dividend Growth Rate: Given we are dividend investing on our way to financial freedom, as we believe dividend income is the best source of passive income, we look at the 5 year dividend growth rate. In addition, we review how many years the company has increased their dividend.

Dividend Increase WRK

1.) P/E Ratio: At an earnings expectation of $4.32, with a recent share price of $37.66, the price to earnings ratio is only 8.72. This is far lower than the S&P 500 P/E ratio of over 20x. A decent sign of undervaluation still in this volatile stock market.

2.) Dividend Payout Ratio: Paying a quarterly dividend of $0.275 or $1.10 per year, the dividend payout ratio is only 25.46%. Therefore, a low and extremely safe dividend. Furthermore, the dividend should be increased no doubt going forward.

3.) Dividend Growth Rate: Now, WestRock cut their dividend down in Q2 of 2020. However, they have gone from $0.20 per share, per quarter, all the way to $0.275. They have increased to this dividend 3x since the dividend reduction. Therefore, they have increased, technically, in 2021 and 2022, so going on 2 years and 2023 will mark the 3rd consecutive year. They are resuming dividend growth, which is a good sign.

Lastly, we’ll take a look at the dividend yield. As an investor, you want to know how much owning this dividend stock pays you now! The yield for WRK is at 2.92%. Not the highest yielding dividend stock, given the current market, but a fairly decent kickback to shareholders.

is Westrock Stock a Stock to buy now?

Now that we’ve gone through the metrics, is WRK a stock to buy for the dividend stock portfolio?

Though they really are making a dividend stock comeback, I already do own 135 shares or $5,000+ worth and invested into this stock. However, for those looking to diversify their investment or dividend stock portfolio, WestRock is offering a decent value proposition, but wish the yield was over the 3% threshold, as that’s how much you can receive from an online savings account.

If you head over to our YouTube channel, you’ll find other undervalued dividend growth stocks that are higher on my list for stocks to buy now!

How about you? Do you own WestRock stock? Are you finding it hard to find an undervalued stock, as the stock market has been showing green? Share your comments and feedback below!

As always, thanks for stopping by, good luck and happy investing!


Originally Posted on dividenddiplomats.com

WRK, Buy

WestRock Co
Return: 46.08%

WRK, Buy

Return: 46.08%

Sound investments
don't happen alone

Find your crew, build teams, compete in VS MODE, and identify investment trends in our evergrowing investment ecosystem. You aren't on an island anymore, and our community is here to help you make informed decisions in a complex world.

More Reads
Investing Starts with an Investment in Yourself

Invest in yourself - it’s the best thing you can do.

Market Musing 11-14-2022: Is a Market Bottom In?

High Volatility: VIX > 23. The US Markets bounced hard on Thursday’s CPI Data. Will Chair Powell pivot on rate hikes before the end of year?

Breakout or Shake Out ?

Market Commentary

AEP to Focus Capital Investments on Regulated Businesses, Reaffirms Operating Earnings Growth Rate of 6 to 7 Percent

Reaffirmed 2022 operating earnings guidance range of $4.97-$5.07 per share and midpoint of $5.02; 2023 operating earnings guidance range of $5.19 to $5.39 per share; Five-year, $40 billion capital plan emphasizes investment in wires and renewables

High Anxiety: China's Covid and US Inflation

Anxiety is running high. Rather than ease its Covid restrictions, a surge in cases is seeing more areas in China come under restrictions.

Common Pitfalls in Retirement Planning

One must be realistic about future plans and think ahead to avoid retirement mistakes. When preparing for retirement, it is easy to make poor financial moves.

Southern Company - A Buy but Not Without Risks

We assess Southern Company to be a buying opportunity. For retail investors, this may be a good time to dollar-cost average into a position in SO.

Dividend Kings in Focus: V. F. Corporation

V.F. Corporation is a giant in the apparel industry. The company’s annual sales amount to nearly $12 billion, but the company has humble beginnings. It started all the way back in 1899 and has seen many twists and turns in the 123 years since.

How to beat inflation with dividend stocks

Does higher inflation have you worried? Are you concerned that your purchasing power will continue to decrease? Dividend stocks can help you beat inflation.

Personal Debt and Credit

It’s important to know how to use credit successfully!

October 2022 Passive Income Update – Lower Dividends, Higher Passive Income

The market decided to climb back up this month and then interest rates rose once again. The narrative hasn’t changed both Tiff and Powell have said they aren’t done raising interest rates in previous hikes. Unfortunately Tiff played his cards first hoping Powell would follow suit with a .5% raise and the US raised theirs .75% essentially devaluing our dollar. Inflation for Canadians should rise on this move alone as it now costs us more to buy stuff in usd.

How to Develop Healthy Habits During Retirement

To say that retirement marks a new chapter in one’s life is an understatement. It’s more than revisiting your previous life journeys and achievements while taking an occasional walk or resting on a couch. There are so many ways to make your golden years joyful. Once you develop healthy habits during retirement and practice them daily, your days become brighter and more exciting. So buckle up, and look at the tips we prepared for you!

“Isn’t Personal Finance Pretty Simple?!”

I’m at a party and someone asks me about The Best Interest. I give my usual answer above loving to write about personal finance and investing, and a third chatter says, No offense, but isn’t personal finance pretty simple!? Make a budget. Spend less than you earn. Invest, but keep fees low. Once you know the, like, eight basic rules or whatever it is, then you’re done. I don’t get how there can be so many blogs and books and podcasts. They’re all just re-hashing the same thing!


Investing is an extremely important part of being wealthy and is how many Americans are able to build wealth and retire. While most Americans know about investing, people often underestimate the power of it and how great of a tool it can be to achieve financial freedom. Additionally, the earlier you start investing, the more powerful it becomes. Because investments grow at an exponential rate, meaning it builds onto itself, investing earlier will leave you with a significant larger retirement sum than if you had chosen to wait.

Is Vanguard In Denial?

I have been writing for a while now about the issue of balanced funds being broken. In 2017, I wrote: Are there ‘suitability’ issues in relation to putting clients into passive multi-asset funds that have massive bond risk? Back in 2008, the real 10-year Gilt yield was around 1%. Although this was low – 10 years earlier real yields were 4% - one could still justify buying Gilts on the basis that the real yield was positive. Fast forward to today and real 10-year interest rates in the UK are close to -2%.

Hedging Interest Rate Risk With Real And Nominal Treasury Yields

The recent rise in real yields for inflation-indexed Treasuries (TIPS) looks compelling for locking in relatively attractive payout rates, but the usual risks with bonds still applies. That inspires looking at a somewhat unorthodox strategy of holding TIPS and conventional Treasuries as a hedging strategy.

How You Can Reduce Your Total Loan Cost [14 Easy Ways]

Whether it is a student loan, private loan, or federal loan, there are ways that you can use to reduce the total loan cost. Some situations can require you to take a loan, whether for personal use, emergencies, mortgage, or school fees, among other needs. When such cases are over, you are left with a huge debt to settle, and the best way for a loan is to find ways to reduce the total cost so that you can reduce the burden that comes with repayment.

Retirement for Introverts

There are a lot of introverts in the world, and they retire. I’m one of them, though I just figured out I am an introvert. There are a ton of implications if you are an introvert and retired. But it comes down to quality over quantity. Let’s explore.

Expectations in Retirement

We expect a lot out of Retirement. What if the key to a successful retirement is to lower our expectations? After all, we will spend a third or more of our life in Retirement. After all that hard work, should we not expect some happiness or at least fun? If you want happiness in Retirement, let me tell you why the key to retirement happiness is to lower your expectations.

Procter & Gamble Stock: Recession Resistant Dividend Aristocrat

When volatility grips the stock market, as it has this past year, income investors should focus on quality dividend growth stocks.

Resources for Publishers
Resources for New Investors
Boosted with BossCoin