Covered, but above its own payout target. A 3.0% yield on a roughly 65% payout against trailing earnings is covered income, but it sits above the company's own 45%–55% target payout range: $0.5925 a quarter, raised in February 2026 by 3.9% for a 23rd consecutive year. The dividend grows; the payout has drifted above the band the company itself targets, so the cushion is thinner than the streak suggests.
Key risk: Capital and wildfire exposure — a multi-year, multi-billion-dollar clean-energy and grid build, including a large Google data-center supply agreement backed by new clean-energy resources, funded with debt and equity, in states where wildfire and storm costs can land on the utility's balance sheet.
Changes if: Earnings fail to grow into the payout, keeping it above the 45%–55% target band, or the capital program requires equity or debt on terms that squeeze the coverage further.
- !Payout-coverage check: About 65% of trailing earnings — $2.37 indicated — above the company's 45%–55% target payout range. Covered, but the payout has drifted above its own band, so there is less room for an earnings miss than the streak implies.
- ✓Yield check: 3.0% indicated — $0.5925/qtr × 4 at the $78.05 close on Oct. 23, 2026. Real, earned yield from regulated operations in 8 Western and Midwestern states, not a special or a return of capital.
- ✓Dividend growth check: 23 consecutive years of increases; the February 2026 raise lifted the quarterly dividend 3.9%, from $0.57 to $0.5925, under a stated policy of targeting 4%–6% annual dividend increases.
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.