Covered, compounding — cyclical. A 2.22% yield on a 57.22% trailing payout is covered, but fuller than most House cards. The $0.295 quarterly rate, approved again on Oct. 22, 2026, continues a rebuild from the 2020 cut, with Q3 2026 free cash flow of $828 million behind it. The payout is real; the business behind it moves with oilfield spending.
Key risk: Oilfield spending cycles — Q2 2026 Middle East revenue fell 13% sequentially on conflict-related disruptions, and Q3 adjusted EPS of $0.64 was down from $0.69 a year earlier. The payout survives soft patches, but the pace of the rebuild depends on activity recovering.
Changes if: Free cash flow falls toward the quarterly dividend total, or the trailing payout pushes well past 57.22%. Cash coverage, not just earnings coverage, is the tripwire here.
- !Payout-coverage check: 57.22% trailing payout ratio — covered, but fuller than most House cards; Q3 2026 free cash flow was $828 million, and the board approved the same $0.295 rate again on Oct. 22, 2026.
- ✓Yield check: 2.22% indicated — $0.295/qtr × 4 at the $53.06 close on Oct. 23, 2026. Real, earned yield.
- ✓Dividend growth check: Raised to $0.295 in January 2026 from $0.285 — the latest in a rebuild from the 2020 cut, with annual increases every year since.
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.