Dividend Spotlight: National Grid

National Grid Logo

In August National Grid was my biggest dividend payer so I selected this company for the first Dividend Spotlight I publish

National Grid is operating electricity and gas networks mainly located in the UK and USA. National Grid. As system operator with regulated prices National Grid is having a nice and steady cashflow.

It’s often that utilities are regulated companies. Due to utilities often having some kind of local monopoly by being the ownly one owning a distribution network for gas or electricity, it’s common that authorities regulate the pricing these kind of companies are allowed to set.

The dividend payment frequency of National Grid is 2 times per year. 70% of their yearly dividend is paid in August. This is probably why National Grid is my biggest payer in August.

I received 2 dividend payments from National Grid this year of in total €85,70. National Grid is at the moment 1,7% of my portfolio and responsible for 1,8% of my dividend income.

Current yield of National Grid is 5,73%.

As a regulated utility the dividend of National Grid is increasing slowly, but steady. The graph below is showing the dividend history of National Grid in last few years:

The compounded anual growth rate since 2016 is 4,37%, but last 5 years the CAGR is 2,37%.

I expect an average dividend growth in the next 5 years between 2.5% – 3,0%. It’s not the biggest dividend growth in my portfolio, but it will result in a nice cashflow to reinvest.