Research — Apr 14, 2025

Dividend Forecasting- Forecast revisions due to potential tariff impacts

Initially, the United States had implemented a series of tariffs on various sectors affecting European Union (EU) countries, which began with reciprocal tariffs targeting key industries such as steel, aluminium, and automobiles. Following these measures, a 90-day pause was introduced to allow for negotiations and discussions regarding trade relations. After the pause came into effect, the US implemented a 10% baseline tariff on imports from all countries, including the EU, with certain exemptions for items such as chips, copper, lumber, pharmaceuticals, bullion, energy, and minerals not found in the US. Autos and auto parts are exempt from this 10% tariff but are still subject to a separate 25% tariff that was introduced last month. The White House confirmed that this 25% tariff will remain in effect. Additionally, the 25% levies on all steel and aluminum imports into the US will continue, and investigations that could lead to tariffs on copper and lumber are ongoing. The ongoing trade tensions and tariff structures have created an uncertain environment for EU companies, compelling them to reassess their strategies in light of potential impacts on profitability and market access.

As a result, we have revised our forecasts for the stocks in the EuroStoxx 50 and FTSE 100 indices to account for the possible impact of the reciprocal tariffs.

Stock name Curr. Previous Estimate Current Estimate Change(%) Comments
Stellantis EUR 0.6800 0.4200 -38.2% There is an EPS downward revision, with high exposure to tariffs in the US.
adidas EUR 3.0000 2.7500 -8.3% We are assuming approximately a 6-7% impact of the tariffs on the FY25 EPS consensus numbers. Here, we assume bearish earnings to build the impact of the tariff on our estimates.
Airbus EUR 2.7000 2.5000 -7.4% There has been a downward revision in EPS consensus. Aerospace is impacted by tariffs, although Airbus is somewhat protected as it has a manufacturing presence in the US.
Kering EUR 6.4000 6.0000 -6.3% There has been a downward revision in EPS consensus. The luxury sector is expected to be potentially impacted by lower consumption following tariffs.
Hermes Intl EUR 19.0000 18.0000 -5.3% There has been a downward revision in EPS consensus. The luxury sector is expected to be potentially impacted by lower consumption following tariffs.
Anglo American Plc EUR 0.6300 0.6000 -4.8% A lower EPS consensus has been used.
Compagnie de Saint-Gobain EUR 2.4000 2.3000 -4.2% The impact is uncertain, due to which the estimate has been trimmed slightly.
Haleon GBP 0.0730 0.0700 -4.1% A lower EPS consensus has been used.
LVMH EUR 13.5000 13.0000 -3.7% There has been a downward revision in EPS consensus. The luxury sector is expected to be potentially impacted by lower consumption following tariffs.
Inditex EUR 0.9300 0.9000 -3.2% A lower EPS consensus has been used.
ASML EUR 7.7500 7.5000 -3.2% The estimate has been adjusted down slightly, as semiconductors tend to be highly exposed to geopolitical tension. However, limited impact is expected so far as ASML has a very strong moat. Semiconductors are exempt from tariffs, although it is still uncertain for ASML as it is an equipment producer.
Unicredit EUR 1.3839 1.3400 -3.2% A more conservative EPS value has been taken.
Vinci EUR 4.9000 4.7500 -3.1% We are using a lower EPS due macro uncertainty.
Unilever GBP 1.8707 1.8248 -2.5% We expected the quarterly DPS to be adjusted by c.3% q/q for FY25 Q4 (instead of Q2 and Q4) given potential negative impacts on profit margin. FY24 saw the first q/q adjustment since FY20 Q4.
Sanofi EUR 4.1000 4.0000 -2.4% Historically, there has been a low-to-mid single-digit increase. We have adjusted our forecast from mid to a low single-digit increase. So far, it has been exempt from tariffs, but an imminent impact is expected.
Experian GBP 0.6425 0.6275 -2.3% The full-year YoY growth has been lowered from 10% to 7% to align with the interim growth.
EssilorLuxottica EUR 4.4000 4.3000 -2.3% There is no change in EPS yet, but a tariff hit is expected.
Danone EUR 2.2500 2.2000 -2.2% The estimate has been trimmed slightly due to fears in the consumer sector, but it remains fairly stable on the whole.
Intesa Sanpaolo EUR 0.1810 0.1770 -2.2% There has been a downward revision in EPS consensus.
Rio Tinto USD 4.0200 3.9400 -2.0% A lower EPS consensus has been used.
Wolters Kluwer EUR 2.5300 2.4800 -2.0% The company has high exposure to the US, but only a small cut is expected, as it also has a defensive business model and has consistently increased DPS in double digits YoY.
SAP EUR 2.5500 2.5000 -2.0% Taking a payout of 40% versus 41% leads to a total growth of 6.4% YoY in DPS.
BNP Paribas EUR 5.2000 5.1000 -1.9% The company is potentially impacted by slowing economic growth.
ING Groep EUR 1.0600 1.0400 -1.9% The company is potentially impacted by slowing economic growth.
Allianz EUR 16.7000 16.4000 -1.8% We are forecasting a growth of 6.5% YoY, taking into account conservative EPS estimates.
L'Oreal EUR 7.3000 7.2000 -1.4% The estimate has been trimmed slightly due to fears in the consumer sector, but it remains fairly stable on the whole.
Iberdrola EUR 0.4040 0.4000 -1.0% There is an earnings downward revision and a more conservative payout ratio.
AXA EUR 2.3200 2.3000 -0.9% The 60% payout policy has been adjusted to fit the latest EPS consensus.
Safran EUR 3.2000 3.1800 -0.6% There is an EPS consensus change, and a 40% payout policy is in place.
Astrazeneca USD 3.2000 3.2000 0.0% Guidance has been provided.
Shell USD 1.4890 1.4890 0.0% A minimum growth of 4% QoQ is estimated for Q2 and Q4. Q2 is exposed to downside risk.
HSBC GBP 0.6600 0.6600 0.0% The dividend is flat. We do not assume a cut.
British American Tobacco GBP 2.4264 2.4264 0.0% We are using a lower EPS consensus along with a flat 2% quarter-over-quarter adjustment for Q4.
BP USD 0.3392 0.3392 0.0% An 8% QoQ growth is projected for Q2, which is lower than the previous quarterly growth, along with strong gearing.
GSK GBP 0.6400 0.6400 0.0% Guidance has been provided.
Bae Systems GBP 0.3650 0.3650 0.0% The dividend cover is slightly above the target, with a 10% YoY growth in line with the past.
Diageo USD 1.0348 1.0348 0.0% No dividend cut is expected, given a long track record of stable YoY growth.
Lloyds Banking Group GBP 0.0351 0.0351 0.0% The company is aiming to pay down its CET1, with a forecasted 11% YoY growth that is lower than in the past.
Barclays GBP 0.0890 0.0890 0.0% The DPS is driven by a change in NOSH, and there is high confidence in this estimate.
Reckitt Benckiser GBP 2.1220 2.1220 0.0% There is a 5% YoY growth and approximately 60% payout ratio, both in line with the past.
Natwest Group GBP 0.2880 0.2880 0.0% The payout ratio has been upgraded to 50%, whereas our forecasts are approximately 48% of the median EPS consensus.
Glencore USD 0.1050 0.1050 0.0% The FY25 CR has already been confirmed, and the CR(2) is currently at a conservative level.
Imperial Brands GBP 1.6032 1.6032 0.0% Guidance has been provided.
Air Liquide EUR 3.5000 3.5000 0.0% Industrial gas is expected to face minimal direct impact from tariffs.
Anheuser-Busch InBev EUR 3.5000 3.5000 0.0% There is no change; it is already estimated to be flat YoY despite an expected increase in EPS. Most beer is produced locally, so there is limited tariff impact.
TotalEnergies EUR 3.4000 3.4000 0.0% The FY25 forecast is already at flat quarterly payments compared to Q4 last year. We do not think that Total will cut dividends, although risks have been highlighted in the comment due to falling oil prices.
BBVA EUR 0.7200 0.7200 0.0% This is already a conservative estimate, with dividends growing by just 1 eurocent YoY.
Banco Santander EUR 0.2190 0.2190 0.0% This is already a conservative estimate, with dividends growing by just 4% YoY.
ENI EUR 1.0500 1.0500 0.0% The annual amount is guided. There could be downward pressure on the amount of buyback, while the dividend remains resilient.
Ferrari EUR 3.1000 3.1000 0.0% The company has already filled its order book for the year, providing reliable cash flow.
BMW EUR 4.3000 4.3000 0.0% Flat dividends are expected. Auto tariffs could result in a huge correction in the range of 20-40% on our current DPS estimates, and we are waiting for more consensus data to forecast reliably.
Volkswagen EUR 6.3000 6.3000 0.0% Flat dividends are expected. Auto tariffs could result in a huge correction in the range of 20-40% on our current DPS estimates, and we are waiting for more consensus data to forecast reliably.
Mercedes-Benz EUR 4.3000 4.3000 0.0% Flat dividends are expected. Auto tariffs could result in a huge correction in the range of 20-40% on our current DPS estimates, and we are waiting for more consensus data to forecast reliably. The impact could be on the higher side for Mercedes than for BMW and VW, as it faces China's retaliation on the tariff, with 34% tariffs assumed.
Deutsche Boerse EUR 4.3000 4.3000 0.0% The company is showing a modest growth of 8%, and the German exchange is expected to benefit from the volatility in the stock markets.
BASF EUR 2.2500 2.2500 0.0% We are forecasting flat dividends.
Bayer EUR 0.1100 0.1100 0.0% We are forecasting the legal minimum dividend.
Deutsche Post EUR 1.8500 1.8500 0.0% We are forecasting flat dividends.
Deutsche Telekom EUR 1.0000 1.0000 0.0% We are taking a conservative payout level.
Munich Re EUR 21.3000 21.3000 0.0% We are forecasting a small progressive growth.
National Grid GBP 0.4662 0.4678 0.3% There is a slightly higher consensus for the UK CPIH.