Thursday, May 7, 2015

Investing: ING: A Meager Dividend Yield, But There Is More To Come

[Full Article Here]

In one of my previous articles, I already looked at the underlying financials. In this article, I will have a look at ING's dividend history and determine whether it is worth investing in the company.


Based on ING's dividend history it can be expected that dividends will grow the coming years. For the comings years an annual dividend slightly higher than €0.50 seems to be reasonable. 

Dividend yield

The dividend yield historically has been in the region of 3%-5%, which is quite good for an AEX stock.
Using the current stock price and future earnings projects a 4% yield is within reach.

Dividend payout ratio

ING's dividend policy is quite nice with a minimal divident payout ratio of 40%.

Price multiple

Taking into account a price multiple for sector peers a stock price of>€16 purely based on valuation with a dividend yield of >3% seems to be fair.

[Full Article Here]

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