Comparing Xcel Energy’s Dividend Yield

Xcel Energy (XEL), based in Minneapolis, Minnesota, declared a quarterly dividend of $0.38 per share on February 21, 2018. The ex-dividend date is March 14, and the dividend will be paid on April 20, 2018. Xcel Energy is expected to pay an annualized dividend of $1.52 in 2018—5.6% higher than its dividend in 2017.

Xcel Energy currently offers a dividend yield of 3.5%, which is in line with the Utilities Select Sector SPDR ETF’s (XLU) 3.6%.

Peers PPL (PPL) and Consolidated Edison (ED) currently yield 5.6% and 3.8%, respectively. Regulated utility giant Duke Energy (DUK) and Georgia-based Southern Company (SO) are trading at dividend yields of 4.7% and 5.2%, respectively.

Xcel Energy’s almost entirely regulated operations enable stable earnings, facilitating stable dividends. The company aims to grow its earnings by 5.0%–6.0% in the next few years, in line with the industry average. Later in this series, we’ll look at more factors that could affect Xcel Energy’s dividends.

Compounded annually, Xcel Energy’s per-share dividends have risen 6.0% the last five years. On average, utilities’ per-share dividends have grown ~4.0%. Duke Energy’s, Southern Company’s, and NextEra Energy’s have risen 2.9%, 3.4%, and 10.4%, respectively.