Where does Ameren rank after its 4% announced dividend increase?

aee

Ameren Corporation (AEE), announced a regular quarterly dividend of $0.44, a 4 percent increase from the prior rate of $0.425 per share. The dividend will be paid at the new higher rate on December 30, 2016, to shareholders of record at close of business on December 7, 2016. Ameren Corp. is currently priced at $48.18.

Listed in the table below are the quarterly dividend payments since 2010. Our analysis of Ameren Corp. as a Top 100 Dividend Stock candidate is listed below;

Date Quarterly Dividend
12/7/2016 0.44
9/6/2016 0.425
6/6/2016 0.425
3/7/2016 0.425
12/7/2015 0.425
9/8/2015 0.41
6/8/2015 0.41
3/9/2015 0.41
12/8/2014 0.41
9/8/2014 0.4
6/9/2014 0.4
3/10/2014 0.4
12/9/2013 0.4
9/9/2013 0.4
6/10/2013 0.4
3/11/2013 0.4
12/10/2012 0.4
9/10/2012 0.4
6/11/2012 0.4
3/12/2012 0.4
12/5/2011 0.4
9/6/2011 0.385
6/6/2011 0.385
3/7/2011 0.385
12/6/2010 0.385
9/7/2010 0.385
6/7/2010 0.385
3/8/2010 0.385

Analysis of Ameren Corp. is based upon our five key criteria for the Top 100 list, which include; 

Category Value Score
Dividend Yield 3.54% 92
Dividend Growth (3-6 year avg) 2.2% 353
Forward P/E 17.60 153
S&P Financial Rating A 120
Beta 0.70 50
Total Score   768

Additional Information on P/S ratio and historical yield;

% Yield 3 Year Div. Growth Rate 6 Year Div. Growth Rate SPS 2016 P/S Ratio 10 yr P/S Low 10 yr P/S High 5 yr max Yield % 5 yr lowest Yield %
3.54% 2.4% 1.9% 24.95 1.93 0.65 1.93 5.57% 3.22%

Final Analysis;

  • Ameren’s dividend yield is above the average of the S&P 500 Index and is below its average historical dividend yield.
  • Ameren maintains a 3 year dividend growth rate of 2.4%.
  • Ameren has paid out a dividend consecutively for the past 18 years.
  • Ameren is trading at a modest forward P/E ratio and at a high price/sales (P/S) ratio.  From a relative valuation perspective based upon P/S, Ameren is overvalued.
  • Ameren maintains a credit rating of A. This is above investment grade, a positive.
  • Ameren maintains a beta of 0.70, lower than the average company.

Based upon its below average dividend growth rate, Ameren Corp. does not qualify as one of our Top 100 Dividend Stocks.

Ameren Corp. Dividend Yield Chart (Click to enlarge)

aee2

Chart Explanation:  Dividend growth stocks may be viewed favorably when the current yield is above historical readings for the past 5 years.

Further information on dividend investing and evaluating dividend growth candidates can be found at http://seekingalpha.com/author/timothy-mcintosh/articles

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s