March 07, 2026 a 12:46 pm
ES: Dividend Analysis - Eversource Energy
Eversource Energy presents itself as a reliable dividend stock with a history of consistent payouts over the past 43 years. The current dividend yield at 4.12% offers an attractive return, backed up by a longstanding commitment to dividend growth, albeit modestly, at around 5.8% over the last five years. There haven't been any recent cuts or suspensions, further underscoring its dependable dividends. However, negative free cash flow and high payout ratios remain a concern that investors should monitor closely.
📊 Overview
Eversource Energy operates in the Utilities sector, known for stable but slow-growing dividend yields.
| Metric | Value |
|---|---|
| Sector | Utilities |
| Dividend Yield | 4.12% |
| Current Dividend Per Share | 2.97 USD |
| Dividend History | 43 years |
| Last Cut or Suspension | None |
🗣️ Dividend History
The consistent dividend payments highlight the company's commitment to returning capital to shareholders. This long-term history is a positive indicator of dividend reliability and potential future increases.
| Year | Dividend Per Share (USD) |
|---|---|
| 2026 | 0.7875 |
| 2025 | 3.0100 |
| 2024 | 2.860 |
| 2023 | 2.700 |
| 2022 | 2.5485 |
📈 Dividend Growth
Dividend growth is an essential metric for understanding a company's ability to increase dividends. Consistent growth can indicate a healthy, sustainable payout.
| Time | Growth |
|---|---|
| 3 years | 5.70% |
| 5 years | 5.81% |
The average dividend growth is 5.81% over 5 years. This shows moderate but steady dividend growth.
📉 Payout Ratio
Payout ratios provide insight into the sustainability of dividend payments. A high payout ratio may indicate that a company is returning a substantial portion of its earnings to shareholders.
| Key Figure | Ratio |
|---|---|
| EPS-Based | 65.85% |
| Free Cash Flow-Based | -2471.06% |
The EPS payout ratio at 65.85% suggests a relatively sustainable payout concerning earnings. However, the negative FCF payout ratio indicates potential cash flow challenges that could impact future dividend stability.
🤑 Cashflow & Capital Efficiency
Analyzing cash flows and capital efficiency helps assess a company's ability to cover liquidity needs and efficiently use its capital.
| Metric | 2025 | 2024 | 2023 |
|---|---|---|---|
| Free Cash Flow Yield | -0.18% | -11.30% | -12.47% |
| Earnings Yield | 6.78% | 3.95% | -2.05% |
| CAPEX to Operating Cash Flow | 101.10% | 207.46% | 263.45% |
| Stock-based Compensation to Revenue | 0% | 0% | 0.23% |
| Free Cash Flow / Operating Cash Flow Ratio | -1.10% | -107.46% | -163.45% |
The consistently negative free cash flow yield and high CAPEX ratios suggest potential inefficiencies in capital deployment and liquidity stress.
📊 Balance Sheet & Leverage Analysis
Understanding leverage ratios and balance sheet health helps gauge financial risk and the company's ability to withstand economic downturns.
| Metric | 2025 | 2024 | 2023 |
|---|---|---|---|
| Debt-to-Equity | 1.87 | 1.94 | 1.89 |
| Debt-to-Assets | 0.47 | 0.49 | 0.48 |
| Debt-to-Capital | 0.65 | 0.66 | 0.65 |
| Net Debt to EBITDA | 5.59 | 7.04 | 19.12 |
| Current Ratio | 0.65 | 0.75 | 0.67 |
| Quick Ratio | 0.59 | 0.67 | 0.59 |
| Financial Leverage | 3.94 | 3.96 | 3.92 |
The debt ratios indicate high leverage, revealing potential risks, particularly under economic strain. A low current ratio further emphasizes liquidity concerns.
🔍 Fundamental Strength & Profitability
Key profitability metrics highlight how effectively a company is generating returns on investments and managing costs.
| Metric | 2025 | 2024 | 2023 |
|---|---|---|---|
| Return on Equity (ROE) | 10.45% | 5.40% | -3.12% |
| Return on Assets (ROA) | 2.65% | 1.36% | -0.80% |
| Net Margin | 12.49% | 6.82% | -3.71% |
| EBIT Margin | 22.06% | 19.79% | 4.87% |
| EBITDA Margin | 39.81% | 34.72% | 11.72% |
| Gross Margin | 30.13% | 31.12% | 40.69% |
| R&D to Revenue | 0% | 0% | 0% |
Profitability remains a mixed picture with declining ROE, signaling challenges in efficiently generating profits and managing costs. The company's reliance on debt-based financing exacerbates these concerns.
📈 Price Development
🏆 Dividend Scoring System
| Category | Score | Score Bar |
|---|---|---|
| Dividend Yield | 3 | |
| Dividend Stability | 4 | |
| Dividend Growth | 3 | |
| Payout Ratio | 2 | |
| Financial Stability | 2 | |
| Dividend Continuity | 5 | |
| Cashflow Coverage | 1 | |
| Balance Sheet Quality | 2 |
Total Score: 22/40
✅ Rating
In summary, Eversource Energy maintains an average dividend profile characterized by a stable payout history and moderate yield. While its dividend history is commendable, potential risks involve high leverage and negative cash flows. Investors should weigh these factors carefully before making decisions.