Five-year average dividend yield
In fiscal 2Q16, Viacom (VIAB) declared a quarterly dividend of $0.40 per share for its Class A and Class B shares. Year-to-date, Viacom has paid $476 million in dividends.
A dividend yield is a measure of a company’s annual dividend per share relative to its price per share. It indicates how much cash an investor is getting for every dollar invested in the company’s equity.
Now let’s compare Viacom’s five-year average dividend yield with its peers. Viacom has a five-year average dividend yield of 2.3%.
As the graph above shows, The Walt Disney Company (DIS) and CBS (CBS) had a five-year average dividend yield of 1.2% each. In contrast, 21st Century Fox (FOXA) had a five-year average dividend yield of 0.8%.
Viacom’s net leverage
On June 9, 2016, Viacom (VIAB) stated at the Gabelli & Company Movie & Entertainment conference that the company has maintained its leverage ratio at ~2.8.
Regarding excess capital, Viacom added, “We do generate a lot of free cash flow. We deploy that capital for all of our investment, developmental needs as opportunities arise. So when we saw the Channel 5 opportunity and how well it would fit in, we certainly went for it, and we will continue to invest organically in any strategic opportunities that come along.”
The company also expects to pay off its debt after the sale of the minority stake in Paramount and be “well within” its “investment grade leverage ratio” target.
Viacom accounts for 0.29% of the PowerShares QQQ Trust Series 1 ETF (QQQ). QQQ has 4.5% exposure to the television sector.