The advice of Wal-Mart de MÃ©xico, SAB de CV (BMV: WALMEX) has announced that it will increase its dividend on November 24 to 0.81 Mex. This results in the dividend yield being 2.4%, which is higher than the industry average.
Check out our latest analysis for Wal-Mart de MÃ©xico. of
Wal-Mart of Mexico. Payouts easily cover distributions
A high dividend yield for a few years doesn’t mean much if it can’t be sustained. However, before this announcement, Wal-Mart de MÃ©xico. de’s dividend was comfortably covered by both cash flow and earnings. This means that most of what the business earns is used to help it grow.
Over the next year, EPS is expected to increase by 8.8%. If the dividend continues on that path, the payout ratio could be 66% by next year, which we believe may be quite sustainable going forward.
Wal-Mart of Mexico. has a solid track record
Even over a long history of paying dividends, the company’s distributions have been remarkably stable. As of 2011, the first annual payment was $ 0.35 Mex, compared to the most recent annual payment of $ 1.63 Mex. This works out to a compound annual growth rate (CAGR) of around 17% per year over that time period. Rapidly growing dividends over a long period of time are a very valuable feature for an income stock.
The dividend seems likely to increase
Investors who have held shares of the company for the past several years will be pleased with the dividend income they have received. We are encouraged to see that Wal-Mart de MÃ©xico. de has increased its earnings per share by 10% per year over the past five years. The growth in EPS bodes well for the dividend, as does the low payout ratio the company is currently reporting.
Wal-Mart of Mexico. Looks like a big dividend share
Overall, we think it could be an attractive income stock, and it’s only getting better by paying a higher dividend this year. The company easily earns enough to cover its dividend payments and it’s great to see that those profits translate into cash flow. All of these factors taken into account, we believe this has strong potential as a dividend-paying stock.
Market movements testify to the high value of a coherent dividend policy compared to a more unpredictable one. Meanwhile, despite the importance of dividend payments, they aren’t the only factors our readers should be aware of when valuing a business. Earnings growth generally bodes well for the future value of the company’s dividend payments. See if the 14 Wal-Mart de MÃ©xico. the analysts we follow expect continued growth with our free report on analysts’ estimates for the company. If you are a dividend investor, you can also view our curated list of high performing dividend stocks.
If you decide to trade in Wal-Mart de MÃ©xico. de, use the cheapest platform * which is ranked # 1 overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, currencies, bonds and funds in 135 markets, all from one integrated account.
This Simply Wall St article is general in nature. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.
*Interactive Brokers Ranked Least Expensive Broker By StockBrokers.com Online Annual Review 2020
Do you have any feedback on this item? Are you worried about the content? Enter into a contract with us directly. You can also send an email to the editorial team (at) simplywallst.com.