Is Flughafen Wien Aktiengesellschaft (VIE:FLU) An Attractive Dividend Stock?
Dividends play an important role in compounding returns in the long run and end up forming a sizeable part of investment returns. Historically, Flughafen Wien Aktiengesellschaft (VIE:FLU) has paid a dividend to shareholders. It currently yields 2.0%. Does Flughafen Wien tick all the boxes of a great dividend stock? Below, I’ll take you through my analysis.
See our latest analysis for Flughafen Wien
5 questions to ask before buying a dividend stock
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
Is it paying an annual yield above 75% of dividend payers?
Does it consistently pay out dividends without missing a payment of significantly cutting payout?
Has dividend per share risen in the past couple of years?
Is its earnings sufficient to payout dividend at the current rate?
Will it be able to continue to payout at the current rate in the future?
How does Flughafen Wien fare?
Flughafen Wien has a trailing twelve-month payout ratio of 45%, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect FLU’s payout to increase to 51% of its earnings, which leads to a dividend yield of 2.9%. Furthermore, EPS should increase to €1.72. The higher payout forecasted, along with higher earnings, should lead to greater dividend income for investors moving forward.
If you want to dive deeper into the sustainability of a certain payout ratio, you may wish to consider the cash flow of the business. Companies with strong cash flow can sustain a higher payout ratio, while companies with weaker cash flow generally cannot.
If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. Although FLU’s per share payments have increased in the past 10 years, it has not been a completely smooth ride. Shareholders would have seen a few years of reduced payments in this time.
Relative to peers, Flughafen Wien generates a yield of 2.0%, which is on the low-side for Infrastructure stocks.
Next Steps:
Considering the dividend attributes we analyzed above, Flughafen Wien is definitely worth keeping an eye on for someone looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. There are three fundamental aspects you should further examine:
Future Outlook: What are well-informed industry analysts predicting for FLU’s future growth? Take a look at our free research report of analyst consensus for FLU’s outlook.
Valuation: What is FLU worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether FLU is currently mispriced by the market.
Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
