{"id":50233,"date":"2026-04-16T23:37:46","date_gmt":"2026-04-16T23:37:46","guid":{"rendered":"https:\/\/www.europesays.com\/ch\/50233\/"},"modified":"2026-04-16T23:37:46","modified_gmt":"2026-04-16T23:37:46","slug":"heres-why-were-wary-of-buying-nestles-vtxnesn-for-its-upcoming-dividend","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ch\/50233\/","title":{"rendered":"Here’s Why We’re Wary Of Buying Nestl\u00e9’s (VTX:NESN) For Its Upcoming Dividend"},"content":{"rendered":"\n

Nestl\u00e9 S.A. (VTX:NESN<\/a>) is about to trade ex-dividend in the next 4 days. The ex-dividend date is two business days before a company’s record date in most cases, which is the date on which the company determines which shareholders are entitled to receive a dividend. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. This means that investors who purchase Nestl\u00e9’s shares on or after the 20th of April will not receive the dividend, which will be paid on the 22nd of April.<\/p>\n

The company’s next dividend payment will be CHF03.10 per share. Last year, in total, the company distributed CHF3.10 to shareholders. Based on the last year’s worth of payments, Nestl\u00e9 stock has a trailing yield of around 3.9% on the current share price of CHF079.43. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. As a result, readers should always check whether Nestl\u00e9 has been able to grow its dividends, or if the dividend might be cut.<\/p>\n

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Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Its dividend payout ratio is 88% of profit, which means the company is paying out a majority of its earnings. The relatively limited profit reinvestment could slow the rate of future earnings growth. We’d be worried about the risk of a drop in earnings. That said, even highly profitable companies sometimes might not generate enough cash to pay the dividend, which is why we should always check if the dividend is covered by cash flow. Over the last year it paid out 71% of its free cash flow as dividends, within the usual range for most companies.<\/p>\n

It’s encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don’t drop precipitously.<\/p>\n

View our latest analysis for Nestl\u00e9 <\/a><\/p>\n

Click here to see the company’s payout ratio, plus analyst estimates of its future dividends.<\/a><\/p>\n

\"historic-dividend\"<\/a> SWX:NESN Historic Dividend April 15th 2026 <\/p>\n

Businesses with shrinking earnings are tricky from a dividend perspective. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. That’s why it’s not ideal to see Nestl\u00e9’s earnings per share have been shrinking at 4.0% a year over the previous five years.<\/p>\n

The main way most investors will assess a company’s dividend prospects is by checking the historical rate of dividend growth. Nestl\u00e9 has delivered 3.3% dividend growth per year on average over the past 10 years. That’s intriguing, but the combination of growing dividends despite declining earnings can typically only be achieved by paying out a larger percentage of profits. Nestl\u00e9 is already paying out 88% of its profits, and with shrinking earnings we think it’s unlikely that this dividend will grow quickly in the future.<\/p>\n

Is Nestl\u00e9 an attractive dividend stock, or better left on the shelf? While earnings per share are shrinking, it’s encouraging to see that at least Nestl\u00e9’s dividend appears sustainable, with earnings and cashflow payout ratios that are within reasonable bounds. It’s not the most attractive proposition from a dividend perspective, and we’d probably give this one a miss for now.<\/p>\n

With that in mind though, if the poor dividend characteristics of Nestl\u00e9 don’t faze you, it’s worth being mindful of the risks involved with this business. For example, we’ve found 1 warning sign for Nestl\u00e9<\/a> that we recommend you consider before investing in the business.<\/p>\n

If you’re in the market for strong dividend payers, we recommend checking our selection of top dividend stocks.<\/a><\/p>\n

Have feedback on this article? Concerned about the content? Get in touch<\/a> with us directly. Alternatively, email editorial-team (at) simplywallst.com.<\/p>\n

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.<\/p>\n","protected":false},"excerpt":{"rendered":"Nestl\u00e9 S.A. (VTX:NESN) is about to trade ex-dividend in the next 4 days. The ex-dividend date is two…\n","protected":false},"author":2,"featured_media":41331,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[126],"tags":[2353,15402,26836,199],"class_list":["post-50233","post","type-post","status-publish","format-standard","has-post-thumbnail","category-nestle","tag-dividend-growth","tag-dividend-payout-ratio","tag-ex-dividend","tag-nestle"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ch\/116417019459698428","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/50233","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/comments?post=50233"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/50233\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media\/41331"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media?parent=50233"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/categories?post=50233"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/tags?post=50233"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}