Covered, compounding — a 19-year streak. A 1.94% yield on a 44.30% trailing payout is covered: $1.42 a quarter, raised in August 2026 from $1.38, extending 19 consecutive years of increases. The railroad pairs a near-2% yield with a payout that still leaves more than half of earnings retained.
Key risk: The pending Norfolk Southern merger — under Surface Transportation Board review with final briefs due May 2027 and a possible close in late 2027, so integration risk and regulatory outcomes, not the current payout, are the open question.
Changes if: The trailing payout pushes well past 44.30%, or the 19-year run of increases breaks. Merger approval terms that change the dividend policy would also reopen the verdict.
- ✓Payout-coverage check: 44.30% of trailing earnings — $5.68 indicated against a $292.87 close on Oct. 23, 2026. Covered, with most earnings retained.
- ✓Yield check: 1.94% indicated — $1.42/qtr × 4 at the $292.87 close on Oct. 23, 2026. Real, earned yield for a single stock, not a special or a return of capital.
- ✓Dividend growth check: 19 consecutive years of increases; the latest raise, paid Sep. 30, 2026, lifted the quarterly dividend from $1.38 to $1.42.
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.