Accelleron Industries (VTX:ACLN) Is Paying Out A Larger Dividend Than Last Year

The board of Accelleron Industries AG (VTX:ACLN) has announced that it will be paying its dividend of $1.20 on the 28th of May, an increased payment from last year's comparable dividend. The payment will take the dividend yield to 2.6%, which is in line with the average for the industry.

Our free stock report includes 1 warning sign investors should be aware of before investing in Accelleron Industries. Read for free now.

Accelleron Industries' Future Dividend Projections Appear Well Covered By Earnings

Unless the payments are sustainable, the dividend yield doesn't mean too much. The last payment made up 76% of earnings, but cash flows were much higher. This leaves plenty of cash for reinvestment into the business.

The next year is set to see EPS grow by 41.0%. Assuming the dividend continues along the course it has been charting recently, our estimates show the payout ratio being 47% which brings it into quite a comfortable range.

View our latest analysis for Accelleron Industries

Accelleron Industries Doesn't Have A Long Payment History

Looking back, the dividend has been stable, but the company hasn't been paying a dividend for very long so we can't be confident that the dividend will remain stable through all economic environments. Since 2023, the annual payment back then was $0.793, compared to the most recent full-year payment of $1.41. This means that it has been growing its distributions at 33% per annum over that time. It is always nice to see strong dividend growth, but with such a short payment history we wouldn't be inclined to rely on it until a longer track record can be developed.

We Could See Accelleron Industries' Dividend Growing

Investors could be attracted to the stock based on the quality of its payment history. We are encouraged to see that Accelleron Industries has grown earnings per share at 7.1% per year over the past three years. The payout ratio is very much on the higher end, which could mean that the growth rate will slow down in the future, and that could flow through to the dividend as well.

Our Thoughts On Accelleron Industries' Dividend

Overall, we always like to see the dividend being raised, but we don't think Accelleron Industries will make a great income stock. The payments haven't been particularly stable and we don't see huge growth potential, but with the dividend well covered by cash flows it could prove to be reliable over the short term. We would probably look elsewhere for an income investment.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. However, there are other things to consider for investors when analysing stock performance. Taking the debate a bit further, we've identified 1 warning sign for Accelleron Industries that investors need to be conscious of moving forward. Is Accelleron Industries not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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