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Summary

• AT&T raises its dividend two.two% to $.forty seven for each quarter.
• This marks the thirty first straight consecutive year of dividend progress.
• Nonetheless, some buyers are unhappy with the dimensions of the increase.
• At existing costs, AT&T yields five.sixty%.

Like clockwork, AT&T (NYSE:T) rewarded its shareholders with a dividend increase. The annual dividend is now $1.88 for every share, or $.forty seven for every quarter and signifies a two.two% boost from the earlier yearly dividend of $one.eighty four per share, or $.46 for each quarter. With this boost, AT&T has now boosted its dividend for 31 straight several years, an remarkable streak by practically any evaluate.

AT&T's dividend progress is likely currently being minimal owing to reduced developments in FCF and sluggish EPS. Primarily based on its projected 2015 EPS of $two.59, AT&T's ahead payout ratio is close to seventy three%. Based mostly on its TTM FCF of $two.16 for each share, the payout ratio is around 87%.

The 2.two% dividend boost is a lot more or much less inline with AT&T's 1-12 months and 3-12 months dividend expansion charge, only somewhat reduced than the two.4% 5-year dividend growth rate, even though significantly decrease when compared to the ten-year common expansio minix neo x8 android tv box.

• Present yr increase: 2.2%
• Year-back improve: 2.3%
• 3-yr regular: two.three%
• five-yr average: two.4%
• ten-year common: 4.nine%

Without a doubt, as shown under, AT&T has been rising its quarterly dividend by a penny each 12 months since 2008. Do observe the large about ten% bump in the dividend for 2006 and 2007. These have been nearly by definition outliers.

T Dividend info by YCharts

Conclusion

While some shareholders have expressed displeasure with the small dimension of the dividend boost, AT&T has by no means truly been about substantial dividend development. Fairly, the firm is a blue-chip cash flow stock, many thanks to its robust 5.sixty% generate and lower valuation. In addition, it is near utility-like, obtaining virtually duopoly standing in the telecom US market place. In other words, AT&T is a conservative investment decision and can effortlessly find a place in most portfolios as a "safety" stock. I would not call it a bond different, but it is pretty near for currently being an fairness.

Disclaimer: The views in this article are for informational reasons only and ought to not be construed as a recommendation to purchase or sell the shares described. Please do your personal because of diligence ahead of generating any expense decision.