Voya Financial’s Dividend Strategy: Stability in a Volatile Market

In an era of economic uncertainty, Voya Financial (NYSE: VOYA) is doubling down on shareholder returns through consistent dividend payouts for both its common and preferred stock. The insurer’s latest announcement of a $0.45 per share common stock dividend for the second quarter of 2025, paired with a $13.3750 per share preferred stock dividend, underscores its commitment to rewarding investors amid rising market volatility.

Common Stock Dividends: A Steady Hand in Turbulent Waters

Voya’s common stock dividend of $0.45 per share—payable on June 26 to shareholders of record as of May 27—aligns with its first-quarter 2025 payout, signaling financial discipline. This consistency is critical for income-focused investors, especially as broader markets grapple with interest rate hikes and geopolitical risks.

The ex-dividend date of May 24 (one business day before the record date) marks the cutoff for eligibility. Investors purchasing shares after May 24 will not receive the dividend, which could influence near-term trading activity.

Historically, Voya’s stock has shown resilience around ex-dividend dates, with minimal sustained dips—a positive sign for income investors. For instance, during the May 2023 ex-dividend period, VOYA shares dipped 1.2% but rebounded within two weeks, reflecting market confidence in its dividend sustainability.

Preferred Stock: Fixed Returns Amid Uncertainty

Voya’s Series B 5.35% fixed-rate reset non-cumulative preferred stock (VOYA.PRB) offers investors a predictable income stream. The second-quarter dividend of $13.3750 per preferred share—or $0.334375 per depositary share—aligns with its 5.35% annualized yield.

The fixed rate remains locked until September 15, 2029, after which it will reset based on the Five-year U.S. Treasury Rate plus 3.21%. This structure provides stability for income seekers, though investors should note the non-cumulative feature: missed dividends are not owed if payments are suspended.

While common shareholders benefit from potential capital appreciation, preferred stockholders enjoy a higher dividend yield (currently ~6.7% for depositary shares), though with limited upside if Voya’s stock surges.

The Backstory: Voya’s Financial Fortitude

Voya’s dividend strategy is underpinned by its robust financials. As of December 2024, the firm managed $340 billion in assets, serving 15.7 million clients through its annuities, retirement solutions, and investment management services. Its recent stock price surge—up 11% in April 2025 to $60.54 from $54.27—hints at market optimism about its ability to sustain payouts.

Critically, Voya emphasizes tax efficiency for its closed-end funds, noting that distributions may include a return of capital—a non-taxable reduction in investors’ cost basis. Final tax details will be disclosed in year-end Form 1099-DIV, but this structure can ease short-term tax burdens.

Risks and Considerations

Despite Voya’s strong fundamentals, risks linger. The non-cumulative nature of preferred dividends means payments could halt if earnings falter. Additionally, rising interest rates could pressure Voya’s fixed-income portfolios, though its long-term care and annuity businesses may buffer against such shifts.

Investors should also monitor Voya’s liquidity and capital adequacy, especially as it navigates regulatory changes. A debt-to-equity ratio of 0.45 (as of Q3 2024) suggests manageable leverage, but this metric warrants ongoing scrutiny.

Conclusion: A Dividend Machine for Defensive Portfolios

Voya Financial emerges as a defensive investment play, blending stable dividends with exposure to recession-resistant sectors like retirement services and life insurance. Its common stock’s 2.3% dividend yield and preferred stock’s 6.7% yield offer income diversity, while its asset management scale ($340B AUM) provides a cushion against economic headwinds.

The May 24 ex-dividend date for common stock and May 26 for preferred shares mark key entry points for income-focused investors. While risks exist, Voya’s consistent payout history and market resilience suggest it remains a reliable component for portfolios seeking steady returns.

In a market where volatility reigns, Voya’s disciplined approach to dividends—backed by scale and diversification—positions it as a standout name in the financial services sector.