5 Dividend Stocks With Low Payout Ratios and Strong Upside Potential

2. Jack Henry & Associates, Inc. (NASDAQ:JKHY)

Upside Potential as of June 24: 45.13%

5-Year Average Payout Ratio: 39.04%

On June 18, RBC Capital lowered its price recommendation on Jack Henry & Associates, Inc. (NASDAQ:JKHY) to $173 from $180. It reiterated an Outperform rating on the stock. The firm said its bullish thesis from the December upgrade has continued to play out. Year to date, the company has secured 43 new core deals, up from 28 during the same period last year. RBC also pointed out that these wins have come from larger financial institutions and carry higher contract values. Even so, the firm believes the shares have become “more dislocated than before” and reduced its price target to reflect the continued re-rating across the fintech sector.

During the fiscal third-quarter 2026 earnings call, CEO, President & Director Gregory Adelson said the company delivered record third-quarter results. Non-GAAP revenue reached $616 million, up 7.3% from the same quarter a year earlier.

Adelson said the sales and marketing team had an outstanding quarter, winning 17 competitive core deals, including five financial institutions with more than $1 billion in assets. Based on the company’s strong momentum, he said management was highly confident it would exceed the 51 core wins recorded in the previous year.

He also said that by the end of April, more than 700 banks and credit unions were live with Tap2Local. Since the company began targeted marketing just a few days earlier, the number of active merchants had doubled to more than 1,600, with several thousand more merchants already in the enrollment process.

Jack Henry & Associates, Inc. (NASDAQ:JKHY) is a financial technology company. Its business operates through the Core, Payments, Complementary, and Corporate and Other segments.