Expected dividend growth
Analysts expect PPL’s (PPL) dividend to grow ~4% next year, and broader utilities’ to grow ~4%–6% on average. The company expects its EPS growth to be ~5%–6% through 2020—well within the peer average range—which could facilitate its targeted dividend growth. PPL has a long dividend payment history, having paid cash dividends for the last 291 quarters. Utility giants Southern Company (SO) and Duke Energy (DUK) are anticipating similar dividend growth in the next few years.
Utilities’ (XLU) dividend growth is largely driven by their earnings growth. The expected dividend growth for NextEra Energy (NEE) and Dominion Energy (D), among the industry’s fastest-growing utilities, is much higher than the industry average. To learn more, read How Dominion Energy’s Dividend Yield Stacks Up with Peers.