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AES Corporation’s Dividend Profile Is Striking

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AES’s dividends

AES Corporation (AES) recently paid a quarterly dividend of $0.12 per share, posting an annual rise of 9%. Utilities’ average dividend growth rate is near 4%–6%. AES expects a dividend growth rate of over 10% going forward. Indeed, its dividend profile is striking among the sector, considering its high dividend growth rate.

AES’s management seems focused on improving shareholder returns, as it’s spent more than 90% of its earnings on dividends. However, AES’s five-year historical average stands near 60%.

AES dvd

AES’s annual dividend growth target of 10% falls roughly in line with the expected dividend growths of NextEra Energy (NEE) and Dominion Resources (D).

AES currently has a dividend yield of nearly 4.2% whereas NextEra Energy and Dominion Resources have yields of 3% and 3.9%, respectively. The Utilities Select Sector SPDR ETF (XLU) currently yields 3.5%.

To learn more about NextEra Energy’s dividends, read Why NextEra Energy Could Be a Sensible Dividend Option.

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