Covered, compounding. A 2.06% yield on a 33.59% trailing payout is covered with room to spare: $1.41 a quarter, raised from $1.38 in October 2026, extending 13 years of increases from America's largest military shipbuilder — the sole builder of Ford-class carriers and a major submarine subcontractor.
Key risk: Shipyard execution — cost overruns, labor shortages, or schedule slips on carrier and submarine programs compress the thin-margin earnings behind the payout.
Changes if: The trailing payout pushes well past 33.59%, or the dividend stops growing. Payout coverage is the tripwire here.
- ✓Payout-coverage check: 33.59% trailing payout ratio — covered, with two-thirds of earnings retained.
- ✓Yield check: 2.06% indicated — $1.41/qtr × 4 at the $274.08 close on Oct. 23, 2026. Real, earned yield, not a special or a return of capital.
- ✓Dividend growth check: 13 years of increases; the latest raise lifted the quarterly dividend from $1.38 to $1.41 in October 2026.
What this grade doesn't say: It screens the dividend only — covered, real, compounding. It says nothing about valuation or price: a well-covered payer can still be overpriced, and its price can still fall.