June 07, 2025 a 07:46 am
📊 Dividend Analysis - Visa Inc.
Visa Inc. showcases a promising, albeit relatively low, dividend yield of approximately 0.64% annually. The consistent dividend history of 18 years suggests a reliable payout strategy, reflecting its robust financial health and commitment to returning value to shareholders. With strong cash flows and a manageable payout ratio, Visa is well-positioned for steady dividend growth.
Overview
Visa Inc., operating in the financial services sector, demonstrates a stable dividend yield of 0.64%, complemented by a current dividend per share of $2.60 USD. The company has maintained a dividend history for an impressive 18 years without any recent cuts or suspensions, signifying reliability and shareholder confidence.
| Category | Details |
|---|---|
| Sector | Financial Services |
| Dividend yield | 0.64% |
| Current dividend per share | $2.60 USD |
| Dividend history | 18 years |
| Last cut or suspension | None |
Dividend History
Understanding the dividend history is essential as it demonstrates the company's strategy for returning profits to shareholders and its financial stability. A consistent or growing dividend payment is a strong signal of corporate profitability and financial health.
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | 1.18 |
| 2024 | 2.15 |
| 2023 | 1.87 |
| 2022 | 1.575 |
| 2021 | 1.335 |
Dividend Growth
Visa's dividend growth rates are critical metrics for potential and current investors, indicating the rate at which the company is increasing its dividend payments. The ability to grow dividends indicates robust earnings growth and financial health.
| Time | Growth |
|---|---|
| 3 years | 17.22% |
| 5 years | 15.41% |
The average dividend growth is 15.41% over 5 years. This shows moderate but steady dividend growth, reflecting Visa's ability to increase shareholder returns while maintaining a solid financial base.
Payout Ratio
Payout ratios are vital for assessing how sustainably a company can continue paying its current dividends. It measures the percentage of earnings a company pays to its shareholders in dividends.
| Key figure | Ratio |
|---|---|
| EPS-based | 25.51% |
| Free cash flow-based | 24.60% |
The EPS-based payout ratio of 25.51% and the FCF-based payout ratio of 24.60% are relatively low, suggesting Visa has a significant buffer to maintain dividends in adverse economic conditions, indicating sound financial management.
Cashflow & Capital Efficiency
Effective cash flow management and capital efficiency are paramount for sustaining operations and rewarding investors. Analytics around free cash flow and operational cash ratios provide insight into financial performance and long-term viability.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 4.19% | 5.29% | 6.10% |
| Earnings Yield | 4.43% | 4.64% | 5.10% |
| CAPEX to Operating Cash Flow | 6.31% | 5.10% | 5.15% |
| Stock-based Compensation to Revenue | 2.37% | 2.34% | 2.05% |
| Free Cash Flow / Operating Cash Flow Ratio | 93.70% | 94.90% | 94.85% |
Visa's cash flow figures indicate efficient capital usage with a stable trend over recent years, underscoring a capacity to reinvest in growth and provide continuous returns to investors.
Balance Sheet & Leverage Analysis
Maintaining a strong balance sheet and managing leverage are crucial aspects of financial stability. These ratios help evaluate a company's ability to finance operations and meet financial obligations.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 0.53 | 0.53 | 0.63 |
| Debt-to-Assets | 22.05% | 22.61% | 26.26% |
| Debt-to-Capital | 34.74% | 34.57% | 38.68% |
| Net Debt to EBITDA | 0.35 | 0.18 | 0.35 |
| Current Ratio | 1.28 | 1.45 | 1.45 |
| Quick Ratio | 1.28 | 1.45 | 1.45 |
| Financial Leverage | 2.41 | 2.34 | 2.40 |
Visa's leveraging is effectively managed, with indicators showing favorable debt management and solid liquidity levels, enhancing financial stability.
Fundamental Strength & Profitability
Strong fundamentals and profitability metrics are essential in illustrating a company's capacity for sustained success and its ability to provide returns to shareholders.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 50.45% | 44.60% | 42.04% |
| Return on Assets | 20.89% | 19.09% | 17.49% |
| Margins: Net | 54.95% | 52.90% | 51.03% |
| Margins: EBIT | 68.35% | 66.40% | 63.71% |
| Margins: EBITDA | 71.23% | 69.29% | 66.65% |
| Margins: Gross | 80.40% | 79.89% | 80.44% |
| Research & Development to Revenue | 0.00% | 0.00% | 0.00% |
Visa displays strong profitability metrics, indicative of its efficient operations and ability to maximize revenue and shareholder value.
Price Development
Dividend Scoring System
| Criteria | Score | Score Bar |
|---|---|---|
| Dividend yield | 3 | |
| Dividend Stability | 5 | |
| Dividend growth | 4 | |
| Payout ratio | 5 | |
| Financial stability | 5 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 5 | |
| Balance Sheet Quality | 5 |
Total Score: 37/40
Rating
Visa Inc. receives a strong dividend rating, with robust fundamentals, consistent dividend payments, and commendable financial stability. The company is recommended as a solid investment choice for those seeking reliable income growth and long-term financial security.