Don't Buy CNA Financial Corporation (NYSE:CNA) For Its Next Dividend Without Doing These Checks

Explore CNA Financial's Fair Values from the Community and select yours

Readers hoping to buy CNA Financial Corporation (NYSE:CNA) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. The ex-dividend date is one business day before a company's record date, which is the date on which the company determines which shareholders are entitled to receive a dividend. The ex-dividend date is an important date to be aware of as any purchase of the stock made on or after this date might mean a late settlement that doesn't show on the record date. Meaning, you will need to purchase CNA Financial's shares before the 18th of August to receive the dividend, which will be paid on the 4th of September.

The company's next dividend payment will be US$0.46 per share. Last year, in total, the company distributed US$3.84 to shareholders. Looking at the last 12 months of distributions, CNA Financial has a trailing yield of approximately 8.0% on its current stock price of US$47.97. If you buy this business for its dividend, you should have an idea of whether CNA Financial's dividend is reliable and sustainable. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.

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If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. CNA Financial paid out 56% of its earnings to investors last year, a normal payout level for most businesses.

Companies that pay out less in dividends than they earn in profits generally have more sustainable dividends. The lower the payout ratio, the more wiggle room the business has before it could be forced to cut the dividend.

Check out our latest analysis for CNA Financial

Click here to see how much of its profit CNA Financial paid out over the last 12 months.NYSE:CNA Historic Dividend August 14th 2025

Have Earnings And Dividends Been Growing?

Companies with falling earnings are riskier for dividend shareholders. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. So we're not too excited that CNA Financial's earnings are down 2.5% a year over the past five years.

Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. CNA Financial has delivered an average of 2.5% per year annual increase in its dividend, based on the past 10 years of dividend payments. Growing the dividend payout ratio while earnings are declining can deliver nice returns for a while, but it's always worth checking for when the company can't increase the payout ratio any more - because then the music stops.

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The Bottom Line

Should investors buy CNA Financial for the upcoming dividend? Earnings per share have been declining and the company is paying out more than half its profits to shareholders; not an enticing combination. This is not an overtly appealing combination of characteristics, and we're just not that interested in this company's dividend.

With that in mind though, if the poor dividend characteristics of CNA Financial don't faze you, it's worth being mindful of the risks involved with this business. Our analysis shows 2 warning signs for CNA Financial and you should be aware of these before buying any shares.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.