Grab Severn Trent Plc (LON:SVT) Today With A Solid 4.41% Dividend Yield
If you are an income investor, then Severn Trent Plc (LSE:SVT) should be on your radar. Severn Trent Plc operates as a water and sewerage company in the United Kingdom, the United States, and internationally. Over the past 10 years, the £4.63B market cap company has been growing its dividend payments, from £0.63 to £0.87. Currently yielding 4.41%, let’s take a closer look at Severn Trent’s dividend profile. See our latest analysis for Severn Trent
What Is A Dividend Rock Star?
It is a stock that pays a stable and consistent dividend, having done so reliably for the past decade with the expectation of this continuing into the future. More specifically: Its annual yield is among the top 25% of dividend payers It has paid dividend every year without dramatically reducing payout in the past Its has increased its dividend per share amount over the past It is able to pay the current rate of dividends from its earnings It is able to continue to payout at the current rate in the future
High Yield And Dependable
Severn Trent’s dividend yield stands at 4.41%, which is high for Water Utilities stocks. But the real reason Severn Trent stands out is because it has a high chance of being able to continue to pay dividend at this level for years to come, something that is quite desirable if you are looking to create a portfolio that generates a steady stream of income.
If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. SVT has increased its DPS from £0.63 to £0.87 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. This is an impressive feat, which makes SVT a true dividend rockstar. The current trailing twelve-month payout ratio for the stock is 67.28%, which means that the dividend is covered by earnings. Going forward, analysts expect SVT’s payout to remain around the same level at 71.82% of its earnings, which leads to a dividend yield of 4.74%. Furthermore, EPS is forecasted to fall to £1.21 in the upcoming year.
Next Steps:
Severn Trent’s strong dividend attributes make it, without a doubt, a stock dividend investors should be considering for their portfolios. However, given this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. I’ve put together three important factors you should further examine:
1. Future Outlook: What are well-informed industry analysts predicting for SVT’s future growth? Take a look at our free research report of analyst consensus for SVT’s outlook.
2. Valuation: What is SVT worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether SVT is currently mispriced by the market.
3. Other Dividend Rockstars: Are there strong dividend payers with better fundamentals out there? Check out our free list of these great stocks here.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
