Altria (NYSE:MO) has announced its annual dividend increase last week, hiking the quarterly payout by 8.0% to $0.61. The upcoming Anheuser-Busch Inbev (NYSE:BUD) merger could mean another dividend increase later this year or early next year.
With expected earnings per share of $3.04 (midpoint of Altria's guidance for the current year) for 2016 and dividend payouts of $2.35 for 2016, Altria's expected dividend payout ratio for the current year is 77%. Some of Altria's earnings (and thus its EPS as well) are generated through the dividends Altria receives from SABMiller (OTCPK:SBMRF) (OTCPK:SBMRY), but after the upcoming merger of SABMiller with Anheuser-Busch Inbev, the dividends Altria receives should increase, which would mean higher earnings for Altria.
The current dividend situation looks like this:
