Liechtensteinische Landesbank (VTX:LLBN) Is Increasing Its Dividend To CHF2.50

Liechtensteinische Landesbank Aktiengesellschaft's (VTX:LLBN) dividend will be increasing from last year's payment of the same period to CHF2.50 on 11th of May. This takes the annual payment to 4.3% of the current stock price, which is about average for the industry.

Check out our latest analysis for Liechtensteinische Landesbank

Liechtensteinische Landesbank's Earnings Will Easily Cover The Distributions

While it is always good to see a solid dividend yield, we should also consider whether the payment is feasible.

Liechtensteinische Landesbank has a long history of paying out dividends, with its current track record at a minimum of 10 years. Based on Liechtensteinische Landesbank's last earnings report, the payout ratio is at a decent 52%, meaning that the company is able to pay out its dividend with a bit of room to spare.

Over the next 3 years, EPS is forecast to expand by 41.7%. The future payout ratio could be 48% over that time period, according to analyst estimates, which is a good look for the future of the dividend.

Dividend Volatility

The company's dividend history has been marked by instability, with at least one cut in the last 10 years. Since 2013, the dividend has gone from CHF1.50 total annually to CHF2.50. This means that it has been growing its distributions at 5.2% per annum over that time. A reasonable rate of dividend growth is good to see, but we're wary that the dividend history is not as solid as we'd like, having been cut at least once.

Liechtensteinische Landesbank Could Grow Its Dividend

With a relatively unstable dividend, it's even more important to see if earnings per share is growing. We are encouraged to see that Liechtensteinische Landesbank has grown earnings per share at 5.6% per year over the past five years. Since earnings per share is growing at an acceptable rate, and the payout policy is balanced, we think the company is positioning itself well to grow earnings and dividends in the future.

Our Thoughts On Liechtensteinische Landesbank's Dividend

In summary, it's great to see that the company can raise the dividend and keep it in a sustainable range. The dividend has been at reasonable levels historically, but that hasn't translated into a consistent payment. The dividend looks okay, but there have been some issues in the past, so we would be a little bit cautious.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. For example, we've picked out 1 warning sign for Liechtensteinische Landesbank that investors should know about before committing capital to this stock. Is Liechtensteinische Landesbank not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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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.