It hasn't been easy to be a shareholder of Insurance Australia Group Ltd (ASX: IAG) in recent years.
Since this time in 2018, the insurance giant's shares have lost almost 40% of their value.
Offsetting some of this decline, though, has been the IAG dividend. Other than during the height of the pandemic, the insurer has consistently rewarded its shareholders with dividend payments twice a year.
Though, it is worth acknowledging that these dividends have been on a downward trajectory during this time.
The question now, though, is whether the worst is over and if the IAG dividend will soon return to growth? Let's take a look at what one leading broker thinks is going to happen.
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Where next for the IAG dividend?
According to a note out of Goldman Sachs, its analysts are expecting the IAG dividend to come in at 15 cents per share in FY 2023. This will be a 36% increase on FY 2022's dividend of 11 cents per share.
We're off to a good start! What about 2024? Well, I have some very good news for you. Goldman believes that the company will be in a position to lift its dividend by a massive 73% to 26 cents per share in FY 2024.
Based on the latest IAG share price of $5.20, this will mean a decent 5% dividend yield for investors to look forward to.
Fortunately, the increases don't stop there. Goldman is expecting a more modest (but solid) increase to the IAG dividend of 11.5% to 29 cents per share in FY 2025. This represents 5.6% dividend yield at today's prices.
All in all, it may have been a difficult period for shareholders, but the pain appears to be over and the good times could be around the corner if Goldman's estimates prove accurate.
