Intercontinental Exchange, Inc. (NYSE:ICE) will increase its dividend from last year’s comparable payment on the 29th of March to $0.45. Despite this raise, the dividend yield of 1.3% is only a modest boost to shareholder returns.
See our latest analysis for Intercontinental Exchange
Intercontinental Exchange’s Payment Has Solid Earnings Coverage
Even a low dividend yield can be attractive if it is sustained for years on end. Prior to this announcement, Intercontinental Exchange’s dividend was comfortably covered by both cash flow and earnings. This indicates that quite a large proportion of earnings is being invested back into the business.
The next year is set to see EPS grow by 41.0%. If the dividend continues along recent trends, we estimate the payout ratio will be 33%, which is in the range that makes us comfortable with the sustainability of the dividend.
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