Timken's (NYSE:TKR) Dividend Will Be Increased To $0.35

editorial-team@simplywallst.com (Simply Wall St)

Sun, May 11, 2025, 6:25 AM 2 min read

The committee of The Timken Company (NYSE:TKR) has announced that the dividend connected 23rd of May volition beryllium accrued to $0.35, which volition beryllium 2.9% higher than past year's outgo of $0.34 which covered the aforesaid period. This makes the dividend output astir the aforesaid arsenic the manufacture mean astatine 2.0%.

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Unless the payments are sustainable, the dividend output doesn't mean excessively much. However, Timken's net easy screen the dividend. This means that astir of its net are being retained to turn the business.

The adjacent twelvemonth is acceptable to spot EPS turn by 33.4%. Assuming the dividend continues on caller trends, we deliberation the payout ratio could beryllium 23% by adjacent year, which is successful a beauteous sustainable range.

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The institution has a sustained grounds of paying dividends with precise small fluctuation. The dividend has gone from an yearly full of $1.00 successful 2015 to the astir caller full yearly outgo of $1.36. This implies that the institution grew its distributions astatine a yearly complaint of astir 3.1% implicit that duration. Although we can't contradict that the dividend has been remarkably unchangeable successful the past, the maturation has been beauteous muted.

Investors could beryllium attracted to the banal based connected the prime of its outgo history. Unfortunately, Timken's net per stock has been fundamentally level implicit the past 5 years, which means the dividend whitethorn not beryllium accrued each year. Earnings maturation is slow, but connected the positive side, the dividend payout ratio is debased and dividends could turn faster than earnings, if the institution decides to summation its payout ratio.

In summary, it is ever affirmative to spot the dividend being increased, and we are peculiarly pleased with its wide sustainability. Distributions are rather easy covered by earnings, which are besides being converted to currency flows. Taking this each into consideration, this looks similar it could beryllium a bully dividend opportunity.

Investors mostly thin to favour companies with a consistent, unchangeable dividend argumentation arsenic opposed to those operating an irregular one. Still, investors request to see a big of different factors, isolated from dividend payments, erstwhile analysing a company. For instance, we've picked retired 2 informing signs for Timken that investors should instrumentality into consideration. Looking for much high-yielding dividend ideas? Try our collection of beardown dividend payers.