Statoil’s Dividend Yield: 5th Place in the Top 8 Integrated Energy Stocks



Statoil’s dividend yield

Statoil (STO) occupies the fifth position in our list of the top eight dividend-yielding stocks. Statoil is a Norwegian integrated energy firm with D&P (development and production) Norway, D&P international, and MMP (marketing, midstream, and processing) business segments. The company’s market cap of ~$75 billion ranks it sixth among the eight companies we’re discussing in this series.

Statoil has a current dividend yield of 4.8%. Statoil announced a dividend of $0.22 per share for its ADRs (American depositary receipts) on July 27, 2017, and it paid the dividend in mid-December 2017.

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STO has consistently paid dividends for the past three years, despite the volatility in oil prices. In fact, its dividends have stayed absolutely stable during this period. Three years ago, STO had made a quarterly dividend payment of 1.8 Norwegian kroner per share (equivalent to almost $0.22 per share). In the past three years, Statoil stock has fallen 16%.


STO is now trading at a forward PE (price-to-earnings) ratio of 16.6x, which is below the average forward PE ratio of 18.5x among the eight integrated energy stocks we’re discussing in this series. STO is also trading at a forward EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation, and amortization) ratio of 3.7x, which is below the peer average of 6.1x.

Notably, Statoil has the highest total-debt-to-total-capital ratio of 45% among the eight integrated energy stocks we’re discussing in this series. However, STO saw a rise in its cash flow from operations during the first nine months of 2017. Thus, with production growth in the offing, in a scenario of higher oil prices, the company could witness a rise in its earnings.

STO marks the beginning of rising valuations among the eight dividend yielders ranked in this series. STO thus provides moderate dividend yield with a slightly higher forward PE ratio.

However, ExxonMobil (XOM), the next in line, provides a relatively lower dividend yield with a higher forward PE ratio. Continue to the next part of this series for more on XOM’s dividend yield—sixth on the list of top eight.


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