Summary
3-Year Dividend Growth measures how much a company’s dividend payments have increased or decreased over the previous three years. It helps investors assess the trend in shareholder distributions.
This metric is useful for identifying companies that have consistently increased dividends over time.
Why it matters
Dividend growth may indicate improving profitability, stronger cash generation, and a commitment to returning capital to shareholders. For income-focused investors, growing dividends can help increase income over time.
However, dividend growth should be sustainable and supported by financial performance.
How it is calculated
3-Year Dividend Growth = Current Dividend compared with Dividend 3 Years Ago
The result is expressed as a percentage growth rate.
How to read it
Positive dividend growth indicates that dividends have increased over the period. Negative dividend growth indicates that dividends have declined.
Investors should review whether dividend growth is supported by earnings growth, cash flow, and a reasonable payout ratio.