Quote Originally Posted by Snoopy View Post
Unlike the ANZ, Westpac do not pin down their dividend policy to a preferred payout ratio. Yet, the Chairman has had the following to say:

From Lindsay Maxsted's Chairmans address in AR2016

"We recognise the importance of dividends for shareholders, and the franking credits attached to those dividends. Our approach is to continue to make dividend payments that are
sustainable in the long-term; that is, ensuring we retain enough of our earnings to hold our capital levels while also retaining sufficient capital for growth. It is also about maximising the payment to distribute franking credits. We are prepared to wear some volatility in the payout ratio to give shareholders some consistency in dividend payments but we must continue to anchor our decision to a long-term sustainable position."

From Lindsay Maxsted's Chairmans address in AR2015

"While dividends have increased, because of our capital initiatives, the path of increases has slowed with a one cent per share rise over the last two halves. We continue to pay out a high portion of profits as dividends to distribute franking credits that are valued by shareholders. It is important to highlight that despite increasing capital, we have maintained our dividend approach of steadily
increasing dividends within a sustainable pay-out ratio."

Make of that what you will. To me it sounds like Westpac doesn't want to cut dividends. But it doesn't sound like the small increases in 'dps' that shareholders have been lead to expect every year is a given either.

SNOOPY

Considering entering at current levels for long term dividend stream.

P/E back to around 13 which is about average over the last 10 years for Westpac.

Are we now around fair value? Or is there potential for short term upside given the drop we've had over the last two months (to add to the attractive yield)?

Or, alternatively, are current levels a bit high given heightened risk of property volatility in Aus?