Why UK companies’ payout potential is still strong

Dividend payout ratios

The traditional UK equity income space is better placed to satiate yield-hungry investors going forward as dividend payout ratios become more consistent with their 15-year average.  In a world with muted economic growth, projects with acceptable investment returns, or attractively priced  acquisitions are harder for companies to come by. This means they can grow their dividend even in the absence of earnings growth. Against this backdrop income-orientated companies will continue to be rewarding for investors

Emma Mogford, Newton

 

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