Valmont Industries (NYSE:VMI) Is Due To Pay A Dividend Of $0.60

Valmont Industries, Inc. (NYSE:VMI) will pay a dividend of $0.60 on the 15th of January. This payment means that the dividend yield will be 0.7%, which is around the industry average.

See our latest analysis for Valmont Industries

Valmont Industries' Future Dividend Projections Appear Well Covered By Earnings

We like to see a healthy dividend yield, but that is only helpful to us if the payment can continue. Before making this announcement, Valmont Industries was easily earning enough to cover the dividend. This means that most of its earnings are being retained to grow the business.

Over the next year, EPS is forecast to expand by 38.3%. If the dividend continues on this path, the payout ratio could be 12% by next year, which we think can be pretty sustainable going forward.

Valmont Industries Has A Solid Track Record

The company has an extended history of paying stable dividends. The annual payment during the last 10 years was $1.00 in 2014, and the most recent fiscal year payment was $2.40. This implies that the company grew its distributions at a yearly rate of about 9.1% 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 Looks Likely To Grow

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. We are encouraged to see that Valmont Industries has grown earnings per share at 20% per year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for Valmont Industries' prospects of growing its dividend payments in the future.

Valmont Industries Looks Like A Great Dividend Stock

Overall, we like to see the dividend staying consistent, and we think Valmont Industries might even raise payments in the future. Distributions are quite easily covered by earnings, which are also being converted to cash flows. Taking this all into consideration, this looks like it could be a good dividend opportunity.

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. For instance, we've picked out 2 warning signs for Valmont Industries that investors should take into consideration. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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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.