Brambles (ASX: BXB) Ups Dividend for Shareholders from Last Year

Investors eyeing stability and returns in the Australian Stock Exchange (ASX) often turn to dividend-paying companies, and Brambles Limited (ASX: BXB) has recently made headlines with its dividend announcements. As we delve into the details, we uncover insights into Brambles' dividend strategy, earnings coverage, and the factors influencing its attractiveness as an income stock.

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Upcoming Dividend Boost

Come April 11th, Brambles Limited plans to increase its dividend to $0.2309, a move that signals confidence in the company's financial health. This translates to a dividend yield of 3.1%, a figure in line with industry standards. Investors keen on regular returns may find Brambles' upcoming dividend payment an appealing prospect.

Earnings Support for Dividend Sustainability

For income investors, the sustainability of dividends is a crucial consideration. Brambles' last payment indicates that the company comfortably earned enough to cover the dividend, reflecting a positive sign for those prioritizing consistency. Notably, a significant portion of earnings is being retained for business growth, showcasing a forward-looking strategy.


Read more: Empowering Portfolios by ASX Energy with a Focus on STO

Anticipated EPS Growth and Payout Ratio

Looking ahead, Brambles is set to experience a substantial 31.5% growth in Earnings Per Share (EPS) in the next year. This growth projection positions the company favorably, with an estimated payout ratio of 67%. A payout ratio within this range is deemed sustainable, adding another layer of confidence for investors eyeing long-term dividends.

Navigating Dividend Volatility

While Brambles boasts a lengthy dividend history, it has not been immune to occasional cuts. Over the last decade, dividends experienced a modest annual growth rate of approximately 2.2%. However, a closer look reveals at least one dividend cut in the past 10 years. Though the recent fiscal year's payment of $0.30 showcases growth, the historical volatility raises caution, impacting its attractiveness as an income investment.

Earnings Growth Signals Potential

To assess the likelihood of future dividend growth, one must examine the company's earnings trajectory. Brambles has demonstrated an impressive 16% annual growth in earnings per share over the past five years. This robust earnings growth coupled with a reasonable payout ratio positions Brambles as a potential candidate for income-focused investors.

Brambles' Dividend as a Solid Choice

In summary, the dividend increase by Brambles is a positive indicator of its financial strength and commitment to rewarding shareholders. The company's ability to comfortably cover dividends, coupled with anticipated earnings growth, contributes to the appeal for income investors. However, historical dividend volatility and a prior dividend cut emphasize the need for cautious consideration.

Identifying Warning Signs

While Brambles appears favorable for income investors, it's essential to remain vigilant. Two identified warning signs—though not detailed in this article—require consideration before making investment decisions. Investors are advised to conduct thorough research and assess these potential risks.


In conclusion, Brambles Limited's dividend story is one of promise and caution, offering both potential rewards and challenges. For investors seeking income stocks, the decision to embrace Brambles' dividend journey requires a balance between its strengths and historical volatility.
Location: Australia

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