- The oil price recovery has boosted the coffers of Vermilion Energy, who completely suspended their dividends during the turmoil of 2020.
- This has seen their free cash flow surge and even conservatively, they could now afford to pay dividends that would provide a desirable yield between 5% and 10%.
- Even though this will likely wait until they have deleveraged to their target, it will thankfully make their dividends more sustainable when they are reinstated.
- They should be able to reach their deleveraging target during 2022, which is not a particularly long wait.
- Given the prospects of seeing a desirable very high dividend yield of 10% on current cost in the future, I believe that a bullish rating is appropriate.
For further details see:
Vermilion Energy: Dividends Returning In 2022, 5% To 10% Yield