Ovintiv Inc. Announces $0.30 Dividend Payment, Raises EPS Projections

Ovintiv's investors will receive a $0.30 dividend on September 29th, with a yield of 2.8%. The company's EPS is expected to increase, potentially alleviating pressure on the dividend. However, the dividend has been cut in the past, and Ovintiv lacks free cash flows. While the company is earning enough to cover payments, the lack of free cash flows may pose a problem in the future. Overall, Ovintiv's dividend is not considered a strong investment.

Ovintiv Inc. (NYSE: OVV) has announced a quarterly dividend of $0.30 per share, set to be paid on September 29th, 2025. This represents an annualized dividend of $1.20 and a yield of 2.8% [1]. The company's recent earnings report showed an earnings per share (EPS) of $1.02, slightly missing analysts' consensus estimates of $1.04. However, analysts anticipate an increase in EPS for the current year, which could potentially alleviate pressure on the dividend.

Despite the expected increase in EPS, Ovintiv lacks free cash flows. The company has been earning enough to cover dividend payments, but the lack of free cash flows may pose a problem in the future. The company's dividend payout ratio (DPR) is currently 53.10%, indicating that a significant portion of earnings is being distributed as dividends [1]. This could be a concern if the company's earnings or cash flows decline in the future.

Historically, Ovintiv has had a history of dividend cuts. The company's dividend payout ratio has been volatile, and there have been instances where the dividend was reduced. This history of dividend cuts may make the current dividend less attractive to investors seeking a stable income stream.

Institutional investors own approximately 83.81% of Ovintiv's stock, and several analysts have weighed in on the stock. Barclays boosted their price objective on shares of Ovintiv from $55.00 to $57.00 and gave the stock an "overweight" rating, while Wells Fargo & Company reduced their price objective from $46.00 to $41.00 and set an "equal weight" rating [1]. Despite the mixed analyst ratings, the consensus rating for Ovintiv is "Buy" with an average price target of $53.07 [1].

In conclusion, while Ovintiv's dividend offers a modest yield of 2.8%, the lack of free cash flows and the company's history of dividend cuts may pose a risk to the dividend's sustainability. Investors should carefully consider these factors before investing in Ovintiv's dividend.

References:
[1] https://www.marketbeat.com/instant-alerts/filing-price-t-rowe-associates-inc-md-sells-202600-shares-of-ovintiv-inc-ovv-2025-08-26/
[2] https://seekingalpha.com/article/4817409-calf-low-valuation-performance-subdued