Wal-Mart de México. de's (BMV:WALMEX) Shareholders Will Receive A Bigger Dividend Than Last Year

Wal-Mart de México, S.A.B. de C.V.'s (BMV:WALMEX) dividend will be increasing from last year's payment of the same period to MX$0.97 on 29th of November. The payment will take the dividend yield to 2.5%, which is in line with the average for the industry.

Check out our latest analysis for Wal-Mart de México. de

Wal-Mart de México. de's Dividend Is Well Covered By Earnings

While it is always good to see a solid dividend yield, we should also consider whether the payment is feasible. However, Wal-Mart de México. de's earnings easily cover the dividend. As a result, a large proportion of what it earned was being reinvested back into the business.

Over the next year, EPS is forecast to expand by 35.8%. If the dividend continues on this path, the payout ratio could be 72% by next year, which we think can be pretty sustainable going forward.

Wal-Mart de México. de Has A Solid Track Record

Even over a long history of paying dividends, the company's distributions have been remarkably stable. Since 2013, the dividend has gone from MX$0.92 total annually to MX$1.72. This implies that the company grew its distributions at a yearly rate of about 6.5% over that duration. The dividend has been growing very nicely for a number of years, and has given its shareholders some nice income in their portfolios.

The Dividend Has Growth Potential

Investors could be attracted to the stock based on the quality of its payment history. Wal-Mart de México. de has seen EPS rising for the last five years, at 7.5% per annum. Wal-Mart de México. de definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

We Really Like Wal-Mart de México. de's Dividend

In summary, it is always positive to see the dividend being increased, and we are particularly pleased with its overall sustainability. 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. Taking this all into consideration, this looks like it could be a good dividend opportunity.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 12 analysts we track are forecasting for Wal-Mart de México. de for free with public analyst estimates for the company. If you are a dividend investor, you might also want to look at our curated list of high yield 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.