Berry Global Group's (NYSE:BERY) Dividend Will Be Increased To $0.275

Berry Global Group, Inc.'s (NYSE:BERY) dividend will be increasing from last year's payment of the same period to $0.275 on 15th of December. Even though the dividend went up, the yield is still quite low at only 1.7%.

See our latest analysis for Berry Global Group

Berry Global Group's Earnings Easily Cover The Distributions

If it is predictable over a long period, even low dividend yields can be attractive. Before making this announcement, Berry Global Group was easily earning enough to 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 39.3%. Assuming the dividend continues along recent trends, we think the payout ratio could be 14% by next year, which is in a pretty sustainable range.

Berry Global Group Is Still Building Its Track Record

It is tough to make a judgement on how stable a dividend is when the company hasn't been paying one for very long. This doesn't mean that the company can't pay a good dividend, but just that we want to wait until it can prove itself.

We Could See Berry Global Group's Dividend Growing

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. Berry Global Group has seen EPS rising for the last five years, at 6.9% per annum. With a decent amount of growth and a low payout ratio, we think this bodes well for Berry Global Group's prospects of growing its dividend payments in the future.

Our Thoughts On Berry Global Group's Dividend

Overall, it's great to see the dividend being raised and that it is still in a sustainable range. While the payout ratios are a good sign, we are less enthusiastic about the company's dividend record. The dividend looks okay, but there have been some issues in the past, so we would be a little bit cautious.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. However, there are other things to consider for investors when analysing stock performance. For example, we've identified 2 warning signs for Berry Global Group (1 is potentially serious!) that you should be aware of before investing. 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.