12-27-2020, 03:26 PM
I've had ALE in my bullpen for several years, but was never impressed enough to move it to the watch list. However, looking again now, it's metrics have improved and it may be worth adding.
Its dividend growth went from 2.9% CAGR over the last 10 years, to 3.7% over the last 5, to 4.7%, 4.9%, and 5.1% for the last three.
Management has guided for 5-7% annual earnings growth, with dividend growth tracking earnings growth and targeting a payout ratio of 60-65%.
The current dividend is 68% of expected 2021 EPS of $3.62, so it may not be too big of an increase coming in January.
However, it looks like 5-6% is possible going forward after that.
Its BBB credit rating is on the low end of my comfort level for a utility, and it doesn't have the track record of a few others on the list, but with a yield over 4% and its growth expectations, it looks like a decent stock to own.
Its dividend growth went from 2.9% CAGR over the last 10 years, to 3.7% over the last 5, to 4.7%, 4.9%, and 5.1% for the last three.
Management has guided for 5-7% annual earnings growth, with dividend growth tracking earnings growth and targeting a payout ratio of 60-65%.
The current dividend is 68% of expected 2021 EPS of $3.62, so it may not be too big of an increase coming in January.
However, it looks like 5-6% is possible going forward after that.
Its BBB credit rating is on the low end of my comfort level for a utility, and it doesn't have the track record of a few others on the list, but with a yield over 4% and its growth expectations, it looks like a decent stock to own.