Sumitomo Mitsui Trust Group (TSE:8309) Will Pay A Larger Dividend Than Last Year At ¥90.00
Sumitomo Mitsui Trust Group, Inc.'s (TSE:8309) dividend will be increasing from last year's payment of the same period to ¥90.00 on 23rd of June. This takes the dividend yield to 3.9%, which shareholders will be pleased with.
Sumitomo Mitsui Trust Group's Payment Expected To Have Solid Earnings Coverage
A big dividend yield for a few years doesn't mean much if it can't be sustained.
Sumitomo Mitsui Trust Group has established itself as a dividend paying company with over 10 years history of distributing earnings to shareholders. Past distributions do not necessarily guarantee future ones, but Sumitomo Mitsui Trust Group's payout ratio of 38% is a good sign as this means that earnings decently cover dividends.
Looking forward, earnings per share is forecast to rise by 5.6% over the next year. If the dividend continues on this path, the future payout ratio could be 41% by next year, which we think can be pretty sustainable going forward.
Check out our latest analysis for Sumitomo Mitsui Trust Group
Sumitomo Mitsui Trust Group Has A Solid Track Record
The company has been paying a dividend for a long time, and it has been quite stable which gives us confidence in the future dividend potential. Since 2015, the dividend has gone from ¥55.00 total annually to ¥180.00. This means that it has been growing its distributions at 13% per annum over that time. We can see that payments have shown some very nice upward momentum without faltering, which provides some reassurance that future payments will also be reliable.
The Dividend Looks Likely To Grow
Investors could be attracted to the stock based on the quality of its payment history. It's encouraging to see that Sumitomo Mitsui Trust Group has been growing its earnings per share at 18% a year over the past five years. Growth in EPS bodes well for the dividend, as does the low payout ratio that the company is currently reporting.
Sumitomo Mitsui Trust Group Looks Like A Great Dividend Stock
Overall, a dividend increase is always good, and we think that Sumitomo Mitsui Trust Group is a strong income stock thanks to its track record and growing earnings. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. All of these factors considered, we think this has solid potential as a dividend stock.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 7 analysts we track are forecasting for Sumitomo Mitsui Trust Group for free with public analyst estimates for the company. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.