Entravision Communications (NYSE:EVC) Has Affirmed Its Dividend Of US$0.025
The board of Entravision Communications Corporation (NYSE:EVC) has announced that it will pay a dividend on the 30th of June, with investors receiving US$0.025 per share. This payment means that the dividend yield will be 2.3%, which is around the industry average.
View our latest analysis for Entravision Communications
Entravision Communications' Earnings Easily Cover the Distributions
Unless the payments are sustainable, the dividend yield doesn't mean too much. However, Entravision Communications' earnings easily cover the dividend. As a result, a large proportion of what it earned was being reinvested back into the business.
Looking forward, earnings per share could rise by 5.6% over the next year if the trend from the last few years continues. Assuming the dividend continues along recent trends, we think the payout ratio could be 32% by next year, which is in a pretty sustainable range.
Entravision Communications Is Still Building Its Track Record
Entravision Communications' dividend has been pretty stable for a little while now, but we will continue to be cautious until it has been demonstrated for a few more years. The dividend has gone from US$0.12 in 2013 to the most recent annual payment of US$0.10. The dividend has shrunk at around 2.0% a year during that period. Declining dividends isn't generally what we look for as they can indicate that the company is running into some challenges.
We Could See Entravision Communications' Dividend Growing
Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. Entravision Communications has seen EPS rising for the last five years, at 5.6% per annum. A low payout ratio and decent growth suggests that the company is reinvesting well, and it also has plenty of room to increase the dividend over time.
Our Thoughts On Entravision Communications' Dividend
Overall, a consistent dividend is a good thing, and we think that Entravision Communications has the ability to continue this into the future. While the payout ratios are a good sign, we are less enthusiastic about the company's dividend record. This looks like it could be a good dividend stock going forward, but we would note that the payout ratio has been at higher levels in the past so it could happen again.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. Just as an example, we've come across 5 warning signs for Entravision Communications you should be aware of, and 1 of them is a bit concerning. Is Entravision Communications not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.
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