PSEG dividend: cash coverage and outlook
PSEG's indicative 2026 dividend is $2.68 per share, rising to $3.00 in 2029 in the base case. In 2025, free cash flow was $26 million, and dividends exceeded the cash left after investment, so borrowing and other funding supported shareholder payments.
How much does PSEG pay in dividends?
Dividends start from the indicative 2026 amount of $2.68 per share. The base case uses $2.78 in 2027, $2.89 in 2028 and $3.00 in 2029. That is slower than the recent 5% annual increases because investment has exceeded internally generated cash. The bear case holds dividends at $2.68 throughout. The bull case reaches $2.84, $3.01 and $3.19 as earnings and recovery support faster increases.
| October 2027 | October 2028 | October 2029 | |
|---|---|---|---|
| Earnings | 2,300 (2,050 / 2,360) | 2,460 (2,040 / 2,570) | 2,630 (2,030 / 2,800) |
| Dividends per share | 2.78 (2.68 / 2.84) | 2.89 (2.68 / 3.01) | 3.00 (2.68 / 3.19) |
| Price to earnings | 15.00 (14.00 / 16.00) | 15.00 (13.00 / 17.00) | 15.00 (12.00 / 18.00) |
Is PSEG's dividend covered by its cash?
In 2025, operating cash flow was $3,298 million against net income of $2,111 million. Capital spending of $3,272 million then left free cash flow of only $26 million. Free cash flow is the cash remaining after operating needs and capital investment, so strong cash generation does not necessarily mean cash is available for dividends.
Some capital spending preserves service, while some expands the future rate base, and the accounts do not cleanly separate the two. Dividends therefore exceeded the cash left after investment, so borrowing and other funding supported both construction and shareholder payments.
| 2025 | 2024 | 2023 | |
|---|---|---|---|
| Free cash flow | 26 | -1,247 | 481 |
| − Dividends paid | 1,258 | 1,196 | 1,137 |
| − Share buybacks | 67.575 | 45.7717 | 25.4159 |
| = Paid out more than the free cash flow | 1,299.575 | 2,488.7717 | 681.4159 |
| Paid out, % of free cash flow | 5098.4% | not meaningful | 241.7% |
What this means. In 2025, the company paid shareholders far more than the cash its business generated, using savings and new borrowing to cover the difference.
What could change PSEG's dividend?
The bear case becomes more likely in 2027–2028 if rate-case timing or cost recovery disappoints. High customer bills from 2027 through 2029 would also pressure both earnings growth and the multiple.
Debt-funded spending is the key financing test in 2028–2029. If cash generation continues to lag capital spending and dividends, interest expense could rise and buybacks could weaken.
What is PSEG's dividend yield today?
| Today (Oct 19, 2026) | |
|---|---|
| Share price | 70.26 |
| Free cash flow yield (calculated) | 0.1% |
| Dividend yield (calculated) | 3.8% |
What this means. The next 12 months price-to-earnings number uses analysts’ expected profit, so it is an estimate rather than a known result.