Owens Corning (NYSE:OC) Is Growing Its Dividend To $0.52
Owens Corning (NYSE:OC) has introduced that it will likely be growing its dividend from final yr’s comparable cost on the nineteenth of January to $0.52. This may take the annual cost to 2.4% of the inventory value, which is above what most corporations within the trade pay.
Take a look at our newest evaluation for Owens Corning
Owens Corning’s Fee Has Strong Earnings Protection
If the funds aren’t sustainable, a excessive yield for just a few years will not matter that a lot. Earlier than making this announcement, Owens Corning was simply incomes sufficient to cowl the dividend. Which means most of its earnings are being retained to develop the enterprise.
Wanting ahead, earnings per share is forecast to fall by 26.6% over the following yr. If the dividend continues alongside latest tendencies, we estimate the payout ratio could possibly be 16%, which we contemplate to be fairly snug, with many of the firm’s earnings left over to develop the enterprise sooner or later.
Owens Corning Is Nonetheless Constructing Its Observe Document
Owens Corning’s dividend has been fairly steady for a short while now, however we are going to proceed to be cautious till it has been demonstrated for just a few extra years. Since 2013, the annual cost again then was $0.64, in comparison with the newest full-year cost of $2.08. Which means it has been rising its distributions at 14% each year over that point. Owens Corning has been rising its dividend fairly quickly, which is thrilling. Nonetheless, the brief cost historical past makes us query whether or not this efficiency will persist throughout a full market cycle.
The Dividend Appears to be like Seemingly To Develop
The corporate’s traders might be happy to have been receiving dividend earnings for a while. It is encouraging to see that Owens Corning has been rising its earnings per share at 34% a yr over the previous 5 years. Earnings have been rising quickly, and with a low payout ratio we expect that the corporate may develop into a fantastic dividend inventory.
Owens Corning Appears to be like Like A Nice Dividend Inventory
In abstract, it’s at all times optimistic to see the dividend being elevated, and we’re notably happy with its general sustainability. The corporate is producing loads of money, and the earnings additionally fairly simply cowl the distributions. Nonetheless, it’s price noting that the earnings are anticipated to fall over the following yr, which can not change the long run outlook, however may have an effect on the dividend cost within the subsequent 12 months. Taking this all into consideration, this seems prefer it could possibly be a very good dividend alternative.
It is necessary to notice that corporations having a constant dividend coverage will generate larger investor confidence than these having an erratic one. On the similar time, there are different components our readers ought to take heed to earlier than pouring capital right into a inventory. Simply for instance, we have come throughout 4 warning indicators for Owens Corning you ought to be conscious of, and 1 of them is probably critical. Is Owens Corning not fairly the chance you had been in search of? Why not take a look at our choice of prime dividend shares.
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This text by Merely Wall St is basic in nature. We offer commentary primarily based on historic information and analyst forecasts solely utilizing an unbiased methodology and our articles will not be meant to be monetary recommendation. It doesn’t represent a advice to purchase or promote any inventory, and doesn’t take account of your goals, or your monetary scenario. We purpose to convey you long-term centered evaluation pushed by basic information. Notice that our evaluation might not issue within the newest price-sensitive firm bulletins or qualitative materials. Merely Wall St has no place in any shares talked about.
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