Comcast Corporation's (NASDAQ:CMCSA) dividend will be increasing from last year's payment of the same period to $0.31 on 24th of April. The payment will take the dividend yield to 2.9%, which is in line with the average for the industry.

Check out our latest analysis for Comcast

Comcast's Payment Has Solid Earnings Coverage

Solid dividend yields are great, but they only really help us if the payment is sustainable. Before making this announcement, Comcast was easily earning enough to cover the dividend. This means that most of its earnings are being retained to grow the business.

Over the next year, EPS is forecast to expand by 27.3%. Assuming the dividend continues along recent trends, we think the payout ratio could be 27% by next year, which is in a pretty sustainable range.

Comcast Has A Solid Track Record

The company has a sustained record of paying dividends with very little fluctuation. The dividend has gone from an annual total of $0.39 in 2014 to the most recent total annual payment of $1.24. This implies that the company grew its distributions at a yearly rate of about 12% over that duration. It is good to see that there has been strong dividend growth, and that there haven't been any cuts for a long time.

Comcast Could Grow Its Dividend

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. Comcast has seen EPS rising for the last five years, at 8.6% per annum. With a decent amount of growth and a low payout ratio, we think this bodes well for Comcast's prospects of growing its dividend payments in the future.

Comcast Looks Like A Great Dividend Stock

Overall, a dividend increase is always good, and we think that Comcast is a strong income stock thanks to its track record and growing earnings. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. All in all, this checks a lot of the boxes we look for when choosing an income stock.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. However, there are other things to consider for investors when analysing stock performance. As an example, we've identified 2 warning signs for Comcast that you should be aware of before investing. Is Comcast not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.