Koninklijke Ahold Delhaize N.V. (AMS: AD) is about to trade ex-dividend in 1 day. If you buy shares on or after April 14, you will not be able to receive this dividend when it is paid on April 23.
Koninklijke Ahold Delhaize’s next dividend will be € 0.46 per share, and in the past 12 months the company has paid a total of € 0.92 per share. Calculation of the value of payments from last year shows that Koninklijke Ahold Delhaize has a yield of 4.1% on the current price of € 22.42. If you are buying this business for its dividend, you need to know if the Koninklijke Ahold Delhaize dividend is reliable and sustainable. So we need to check if dividend payments are covered and if profits are increasing.
Check out our latest analysis for Koninklijke Ahold Delhaize
Dividends are generally paid on the profits of the business. If a company pays more in dividends than it earns in profits, then the dividend could be unsustainable. This is why it is good to see Koninklijke Ahold Delhaize pay 48% of its income. A useful secondary check can be to assess whether Koninklijke Ahold Delhaize has generated enough free cash flow to pay its dividend. It distributed 34% of its free cash flow in the form of dividends, a comfortable level of payment for most companies.
It is encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests that the dividend is sustainable, as long as profits do not plummet.
Click here to view the company’s payout ratio, as well as analysts’ estimates of its future dividends.
Have earnings and dividends increased?
Companies with constantly increasing earnings per share are generally the best stocks of dividends because they generally find it easier to increase dividends per share. If profits decline enough, the company may be forced to reduce its dividend. For this reason, we are pleased to see that Koninklijke Ahold Delhaize’s earnings per share have increased by 11% per year over the past five years. Earnings per share is growing rapidly and the company retains more than half of its earnings within the company; an attractive combination which could suggest that the company focuses on reinvestment to increase its profits. Fast-growing companies that reinvest heavily are attractive from a dividend perspective, especially since they can often increase the payout rate later.
Many investors will assess the dividend yield of a business by assessing how dividend payments have changed over time. Koninklijke Ahold Delhaize has averaged 16% annual dividend growth over the past ten years. Both earnings per share and dividends have grown rapidly in recent times, which is great to see.
Koninklijke Ahold Delhaize worth buying for its dividend? Koninklijke Ahold Delhaize increased earnings per share while simultaneously reinvesting in the business. Unfortunately, it has reduced the dividend at least once in the past ten years, but the conservative payout ratio makes the current dividend sustainable. This is a promising combination that should mark this company that deserves special attention.
So while Koninklijke Ahold Delhaize looks good from a dividend perspective, it’s always worth keeping up to date with the risks involved with this stock. Example: we have spotted 2 warning signs for Koninklijke Ahold Delhaize you must be aware.
We wouldn’t just recommend buying the first stock of dividends you see, however. Here is a list of interesting dividends with a return above 2% and a dividend to come.
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Our goal is to provide you with long-term targeted research analysis based on fundamental data. Please note that our analysis may not take into account the latest price-sensitive corporate announcements or qualitative material. Thanks for the reading.
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