Thursday, February 13, 2020

Dividend raise: TROW (+18%)

Yesterday T. Rowe Price (TROW) announced a quarterly dividend raise from $0,76 to $0,90. This raise of more than 18% adds just over € 10 to my annual dividend income.

I am an owner of TROW since July 2016. I purchased share for a price of around $75. Currently shares are worth almost $140, so in price appreciation alone this position has netted me about 19% per year. However, if you add in the dividend along the ride, the total return is bumped up to 18,9%. I honestly have nothing to complain here!

The dividend has grown from a quarterly dividend of $0,54 in September 2016 to $0,90 just now. This is an awesome annual dividend growth rate of 16%. However, its payout ratio is still rather comfortable at just over 40% based on the new dividend! I therefore expect the growth to continue. Its P/E-ratio looks solid as well (16x). Its dividend yield has come down a bit lately (2,6%) but I would consider adding to this position in the near future.

So far I have received 7 raises in 2020. My annual forward dividend income has grown with more than € 21 because of these raises.

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