Last week, PPL’s (PPL) management declared a dividend of $0.41 per share. The dividend will be paid on October 1, while the ex-dividend date is September 7. The dividend represents an annualized dividend of $1.64 per share for 2018—an increase of 2.5% increase from 2017.
Currently, PPL is trading at a dividend yield of 5.6%, which is higher than utilities’ average yield of 3.3%. PPL is trading at a yield that’s more than double NextEra Energy’s (NEE) yield—the biggest utility by market capitalization. Duke Energy (DUK) and Southern Company (SO) stocks offer dividend yields of 4.6% and 5.3%, respectively.
PPL is trading at a superior dividend yield compared to its peers. However, PPL’s dividend per share growth in the last few years was much lower than the industry average. PPL’s dividend per share rose 1.8% compounded annually in the last five years. During the same period, utilities at large (XLU) managed to increase dividends ~4% compounded annually.
Southern Company and Duke Energy managed to raise their dividends per share 3.4% and 2.9%, respectively, compounded annually in the last five years. NextEra Energy, the biggest component of the Utilities ETF (XLU), managed to increase its dividends per share more than 10% compounded annually in the last five years.
PPL’s payout ratio was 75% in the last 12 months, which was higher than its five-year average payout ratio of 65%.
NextEra Energy, Duke Energy, Southern Company (SO), and Dominion Energy (D) are the top four utilities by market capitalization. To compare their dividend profiles, read Analyzing the Biggest S&P 500 Utilities’ Dividend Profiles.