Fundamental Glossary / Growth Metrics
Dividend Growth
The percentage change in the dividend per share.
Formula
(This period DPS - last period DPS) / last period DPS. Use the regular dividend. Show special dividends separately.
What it means
Dividend growth is the pace at which cash income per share rises. Long records of increases are a management signal as well as an income fact.
It can only be sustained if earnings and free cash flow grow as well, unless the payout ratio is allowed to rise.
How to read it
Dividend growth below EPS growth builds cover. Dividend growth above EPS growth for several years spends down that cover and eventually stops.
What to watch
A bonus or split changes the per-share dividend. Adjust history. A special dividend is not a new run-rate, even though it raises the cash received that year.
This note explains the term. It is not a research recommendation, a target price, or a comment on any security. Ratios and regulatory thresholds change; use the latest filing or circular for a live figure.