Wynn Resorts (NASDAQ:WYNN) Has Announced A Dividend Of $0.25

Wynn Resorts, Limited's (NASDAQ:WYNN) investors are due to receive a payment of $0.25 per share on 30th of August. This payment means the dividend yield will be 1.3%, which is below the average for the industry.

View our latest analysis for Wynn Resorts

Wynn Resorts' Dividend Is Well Covered By Earnings

While yield is important, another factor to consider about a company's dividend is whether the current payout levels are feasible. However, prior to this announcement, Wynn Resorts' dividend was comfortably covered by both cash flow and earnings. This means that most of what the business earns is being used to help it grow.

EPS is set to fall by 23.7% over the next 12 months. If the dividend continues along the path it has been on recently, we estimate the payout ratio could be 15%, which is comfortable for the company to continue in the future.

Dividend Volatility

The company has a long dividend track record, but it doesn't look great with cuts in the past. Since 2014, the dividend has gone from $11.50 total annually to $1.00. The dividend has fallen 91% over that period. Generally, we don't like to see a dividend that has been declining over time as this can degrade shareholders' returns and indicate that the company may be running into problems.

Wynn Resorts May Find It Hard To Grow The Dividend

Given that the track record hasn't been stellar, we really want to see earnings per share growing over time. Unfortunately, Wynn Resorts' earnings per share has been essentially flat over the past five years, which means the dividend may not be increased each year. If Wynn Resorts is struggling to find viable investments, it always has the option to increase its payout ratio to pay more to shareholders.

Our Thoughts On Wynn Resorts' Dividend

Overall, a consistent dividend is a good thing, and we think that Wynn Resorts has the ability to continue this into the future. The dividend has been at reasonable levels historically, but that hasn't translated into a consistent payment. The payment isn't stellar, but it could make a decent addition to a dividend portfolio.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. However, there are other things to consider for investors when analysing stock performance. For example, we've identified 4 warning signs for Wynn Resorts (2 are potentially serious!) that you should be aware of before investing. Is Wynn Resorts 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.