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The Latest Forward Yield and Dividend Growth Numbers among Utilities like PPL

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PPL’s forward dividend yield

A company’s forward dividend yield is calculated by dividing its estimated one-year future dividend per share by its current market price per share. PPL Corporation (PPL) is currently trading at a forward dividend yield of 4%, with an expected dividend growth rate of slightly under 2% for the next two years.

The Latest Forward Yield and Dividend Growth Numbers among Utilities like PPL

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Peer comparisons

Among PPL’s regulated peers, Xcel Energy (XEL) is likely to have better dividend growth over the next two years. It has an expected dividend growth of 6%, with a forward dividend yield of 3.5%. New York’s regulated utility, Consolidated Edison (ED), has an estimated dividend growth rate of 2.2%, and it is currently trading at a forward yield of 3.8%.

Many mid-size regulated utilities are currently trading in the same forward yield range as Xcel, with dividend growth expected to be in the range of 4%–6%, depending on their earnings. But given their relatively stable earnings, regulated utilities are expected to pay more stable dividends than unregulated ones.

DVY

The iShares Select Dividend ETF (DVY) is a smart beta fund that aims to generate returns higher than broader markets. DVY tracks and holds 100 high-dividend-paying companies in the US. It has a high exposure of over 31% to utilities, and PPL has near 1% weighting in DVY, which makes it an attractive investment option for investors seeking high yield and low risk.

Continue to the next part for a look at how PPL is preparing for the US Clean Power Plan.

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