Pearson PLC (GB0006776081)
 
 

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Stand (close): 03.07.25

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18.04.25 06:05:44 Investors in Pearson (LON:PSON) have seen strong returns of 194% over the past five years
When you buy shares in a company, it's worth keeping in mind the possibility that it could fail, and you could lose your money. But on the bright side, if you buy shares in a high quality company at the right price, you can gain well over 100%. For instance, the price of Pearson plc (LON:PSON) stock is up an impressive 160% over the last five years.

So let's assess the underlying fundamentals over the last 5 years and see if they've moved in lock-step with shareholder returns.

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To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

During five years of share price growth, Pearson achieved compound earnings per share (EPS) growth of 14% per year. This EPS growth is slower than the share price growth of 21% per year, over the same period. This suggests that market participants hold the company in higher regard, these days. And that's hardly shocking given the track record of growth.

The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).LSE:PSON Earnings Per Share Growth April 18th 2025

We know that Pearson has improved its bottom line over the last three years, but what does the future have in store? This free interactive report on Pearson's balance sheet strength is a great place to start, if you want to investigate the stock further.

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. We note that for Pearson the TSR over the last 5 years was 194%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!

A Different Perspective

It's good to see that Pearson has rewarded shareholders with a total shareholder return of 20% in the last twelve months. That's including the dividend. However, that falls short of the 24% TSR per annum it has made for shareholders, each year, over five years. Most investors take the time to check the data on insider transactions. You can click here to see if insiders have been buying or selling.

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If you like to buy stocks alongside management, then you might just love this freelist of companies. (Hint: many of them are unnoticed AND have attractive valuation).

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on British exchanges.

Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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09.04.25 16:00:00 Certifications Fuel Success in the Age of AI: Pearson Releases the 2025 Value of IT Certification Candidate Report
SAN DIEGO, April 9, 2025 /PRNewswire/ -- Pearson (FTSE: PSON.L) and its Pearson VUE business, the global leader in computer-based testing, released their newest Value of IT Certification Candidate Report. This comprehensive study, the ninth in an ongoing series, provides crucial insights into the evolving landscape of IT certification and its impact on professionals and organizations worldwide.2025 Value of IT Certification Candidate R

The report, based on survey responses from nearly 24,000 IT professionals across the globe, offers a detailed analysis of the motivations, benefits, and organizational impacts of certifications.

"As the tech industry undergoes rapid transformation, particularly with the advent of artificial intelligence, the findings underscore the critical role of IT certification in driving career advancement and organizational innovation," said Dr. Gary Gates, Managing Director, Pearson VUE. "Our 2025 report reveals the growing importance of IT certifications in a time where technology is continually advancing. Certified professionals not only gain a competitive edge but also contribute significantly to organizational success through improved work quality and increased productivity."

Key highlights from the report include:

Tangible career benefits and advancement Underlining that certification leads to concrete career benefits, including promotions, salary increases, and the ability to adapt to changing job responsibilities, the report shows that:

82% of respondents gained confidence to explore and pursue new job opportunities upon earning a certification. 63% of respondents received a job promotion or anticipated one at the time of the survey and within the context of earning a certification. 32% of respondents received a salary increase after certification and 41% were hoping to receive one. 31% of raises received were above 20%.

Organizational benefits when employees are certified Confirming the value to organizations, the report finds that certified employees demonstrated improved performance, innovation, and peer support.

79% of respondents reported a better quality of their work. 76% of respondents reported an increased ability to innovate and enhance work processes and outcomes. 70% of respondents are more productive on the job.

The impact of AI and emerging technologies Unsurprisingly, the report reveals that artificial intelligence (AI) and emerging technologies are reshaping the IT certification landscape, influencing certification priorities and investments for both employers and professionals. This shift is driving significant changes in career development, organizational benefits, and the future of IT learning. Most notably, the report's findings demonstrate that:

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AI has become a key driver in the IT certification field, with a substantial increase in related certifications and investments. The number of candidates planning to earn a certification in AI and machine learning more than doubled in two years, increasing from 17% in 2022 to 35% in 2024. AI is also the second largest specialty area in which candidates plan to pursue certification. 69% of candidates' employers started or increased investments in AI.

A future of continual learning Respondents also reported that continuous upskilling through certification has become essential for career longevity in the age of AI, with professionals embracing lifelong learning.

84% of candidates are likely or very likely to pursue another IT certification in the next 12 months. The number of certifications held increases significantly with age and career tenure.

"This year's study revealed that there were substantial career benefits for certified professionals, as well as significant organizational advantages, as certified employees contribute to improved work quality, enhanced innovation, and increased productivity," said Dr. Gates.

IT certifications have become a vital tool for professionals to validate their skills and stay competitive in an industry that is continually advancing and evolving. The report identifies a marked shift towards AI-related certifications, with the number of candidates planning to earn AI and machine learning certifications more than doubling in just two years.

"Similarly, certifications have far-reaching impacts on careers, organizations, and the tech ecosystem. From AI investments to salary increases, certification shapes modern IT professionals' career journeys and their employers' strategies. Our survey results highlight the importance of lifelong learning in the face of accelerating technological advancements," concludes Dr. Gates.

Pearson VUE's latest study provides valuable insights for IT professionals, employers, and industry leaders, offering a far-reaching view of the certification landscape and its pivotal role in shaping the future of the tech industry. To access the full report and discover what's driving the value of IT certification for candidates and organizations, visit the Value of IT Certification Reporthomepage.

About Pearson
At Pearson, our purpose is simple: to help people realize the life they imagine through learning. We believe that every learning opportunity is a chance for a personal breakthrough. That's why our c. 18,000 Pearson employees are committed to creating vibrant and enriching learning experiences designed for real-life impact. We are the world's lifelong learning company, serving customers in nearly 200 countries with digital content, assessments, qualifications, and data. For us, learning isn't just what we do. It's who we are. Visit us at pearsonplc.com.

About Pearson VUE Pearson VUE has been a pioneer in the computer-based testing industry for decades, delivering close to 21 million certification and licensure exams annually in every industry from academia and admissions to IT and healthcare. We are the global leader in developing and delivering high-stakes exams via the world's most comprehensive network of nearly 20,000 highly secure test centres as well as online testing across more than 180 countries. Our leadership in the assessment industry is a result of our collaborative partnerships with a broad range of clients, from leading technology firms to government and regulatory agencies. For more information, please visit PearsonVUE.com.Highlights from the 2025 Value of IT Certificate Candidate Report by Pearson VUEPearson VUECision

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SOURCE Pearson Vue

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08.04.25 14:10:08 Pearson unveils new brand identity ‘to embrace future of learning’
Pearson (PSO) announced the unveiling of “a dynamic new brand identity that demonstrates its leadership as a lifelong learning company. More than just a refreshed logo, the rebrand represents a deep understanding of the evolving needs of learners worldwide. Pearson’s brand evolution is grounded in a core belief: humans are born to learn. The company views learning not just as acquiring knowledge, but a vital force for growth, adaptation and thriving in a rapidly changing world. This understanding is at the heart of the new brand.”

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07.04.25 14:00:00 Pearson Redefines its Brand to Embrace the Future of Learning
New brand identity reflects learning as a core human need, essential for personal happiness and progress

LONDON, April 7, 2025 /PRNewswire/ -- Pearson (FTSE: PSON.L), the world's leading learning company, today unveiled a dynamic new brand identity that demonstrates its leadership as a lifelong learning company. More than just a refreshed logo, the rebrand represents a deep understanding of the evolving needs of learners worldwide.(PRNewsfoto/Pearson Education, Inc.)

Pearson's brand evolution is grounded in a core belief: humans are born to learn. The company views learning not just as acquiring knowledge, but a vital force for growth, adaptation and thriving in a rapidly changing world. This understanding is at the heart of the new brand.

"Our new brand reflects our belief in the transformative power of learning," said Ginny Cartwright Ziegler, Chief Marketing Officer at Pearson. "It captures the emotional core of learning—the innate human desire to grow, adapt and thrive. We understand that learning is a deeply personal journey, and our new brand resonates with that experience, celebrating the curiosity, resilience and ambition of learners everywhere."

Pearson has invested significantly in understanding the science of learning and how individuals learn most effectively. Research has shown that people who work to improve a skill or ability feel happier day-to-day and long term, even when learning itself feels challenging. Additionally, those who spend more time learning, whether in formal schooling or informal experiences, are more likely to report having purpose in their life. These insights have informed the development of the new brand and will continue to shape Pearson's products and services, ensuring they remain at the forefront of innovation and efficacy.

"This rebrand is not just about new logos or colors; it's a bold step in redefining who we are, what we stand for and our commitment to help people realize the life they imagine through learning," said Pearson CEO Omar Abbosh. "Learning shapes our thoughts, feelings, connections and successes, driving growth at every stage of life. This future-oriented vision aligns deeply with our culture and our products and services, laying the foundation for sustained value creation and guiding our transformation to better serve learners, educators and partners worldwide."

To learn more about Pearson's new brand identity and its vision for the future of learning, please visit https://plc.pearson.com/.

About Pearson At Pearson, our purpose is simple: to help people realize the life they imagine through learning. We believe that every learning opportunity is a chance for a personal breakthrough. That's why our c. 18,000 Pearson employees are committed to creating vibrant and enriching learning experiences designed for real-life impact. We are the world's lifelong learning company, serving customers in nearly 200 countries with digital content, assessments, qualifications, and data. For us, learning isn't just what we do. It's who we are. Visit us at pearsonplc.com.

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Media Contact:
Laura Ewartlaura.ewart@pearson.com (Europe)

Sami Millersami.miller@pearson.com (US)Cision

View original content to download multimedia:https://www.prnewswire.com/news-releases/pearson-redefines-its-brand-to-embrace-the-future-of-learning-302422084.html

SOURCE Pearson

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01.04.25 13:24:17 There's Been No Shortage Of Growth Recently For Pearson's (LON:PSON) Returns On Capital
If we want to find a stock that could multiply over the long term, what are the underlying trends we should look for? Typically, we'll want to notice a trend of growing return on capital employed (ROCE) and alongside that, an expanding base of capital employed. If you see this, it typically means it's a company with a great business model and plenty of profitable reinvestment opportunities. So on that note, Pearson (LON:PSON) looks quite promising in regards to its trends of return on capital.

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What Is Return On Capital Employed (ROCE)?

Just to clarify if you're unsure, ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. The formula for this calculation on Pearson is:

Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)

0.10 = UK£565m ÷ (UK£6.9b - UK£1.5b) (Based on the trailing twelve months to December 2024).

Therefore, Pearson has an ROCE of 10%. In isolation, that's a pretty standard return but against the Consumer Services industry average of 14%, it's not as good.

Check out our latest analysis for Pearson LSE:PSON Return on Capital Employed April 1st 2025

Above you can see how the current ROCE for Pearson compares to its prior returns on capital, but there's only so much you can tell from the past. If you're interested, you can view the analysts predictions in our freeanalyst report for Pearson .

The Trend Of ROCE

Pearson is showing promise given that its ROCE is trending up and to the right. Looking at the data, we can see that even though capital employed in the business has remained relatively flat, the ROCE generated has risen by 71% over the last five years. So it's likely that the business is now reaping the full benefits of its past investments, since the capital employed hasn't changed considerably. It's worth looking deeper into this though because while it's great that the business is more efficient, it might also mean that going forward the areas to invest internally for the organic growth are lacking.

The Key Takeaway

As discussed above, Pearson appears to be getting more proficient at generating returns since capital employed has remained flat but earnings (before interest and tax) are up. And a remarkable 188% total return over the last five years tells us that investors are expecting more good things to come in the future. In light of that, we think it's worth looking further into this stock because if Pearson can keep these trends up, it could have a bright future ahead.

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While Pearson looks impressive, no company is worth an infinite price. The intrinsic value infographic for PSON helps visualize whether it is currently trading for a fair price.

While Pearson isn't earning the highest return, check out this freelist of companies that are earning high returns on equity with solid balance sheets.

Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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31.03.25 16:00:00 Pearson Announces Newly Expanded Role for Chief Technology Officer, Dave Treat, as Company Further Scales AI and Tech Capabilities
Dave Treat to lead Pearson's digital and technology operation, expanding his current architectural and innovation responsibilities

LONDON, March 31, 2025 /PRNewswire/ -- Pearson (FTSE: PSON.L), the world's lifelong learning company, announced today that Dave Treat, Pearson's Chief Technology Officer, will assume leadership of the company's digital and technology operation alongside his current architectural and innovation responsibilities, effective April 7. Dave will continue to report to CEO Omar Abbosh and retain his title of Chief Technology Officer. Marykay Wells, who has led the Digital and Technology team as Chief Information Officer, has decided to leave Pearson, effective April 4. Dave Treat, Global CTO

Dave joined Pearson nine months ago and spearheaded the establishment of the company's AI Center of Enablement, while also overseeing the Research & Development and Ventures teams. He brings to the role nearly 30 years of experience, with deep expertise in technology innovation, generative AI, spatial computing, Web 3, and quantum computing. Prior to joining Pearson, Dave held several senior technology roles at Deloitte, UBS Investment Bank, and Accenture. He holds more than 100 patents in distributed ledger technology, digital identity, and confidential computing. He also lends his expertise as an active member of CNBC's Technology Executive Council, the World Economic Forum's Global Futures Council on Financial Education, and as a member of the transitional board of Arya.

With his extensive expertise, Dave will play a crucial role in leveraging Pearson's strong technology foundation to scale the company's AI offerings, bolster its innovation pipeline, and improve collaboration across different business units.

Omar Abbosh, Pearson CEO, said: "Dave has had a significant influence on Pearson in the nine short months since he joined the company. His innovative work with customers is already positioning us for stronger growth. Through his leadership in developing our innovation architecture and establishing our AI Center, he has been a key player in our ability to attract and harness the incredible talent and capabilities of Pearson. He also is inspiring our team to envision the next big breakthrough.

"We have been very lucky to have Marykay at the helm of our technology efforts in recent years. Her strategic and disciplined leadership drove a massive and complex print-to-digital transformation. She and her global team embraced generative AI to build state-of-the-art global platforms and solutions to drive efficiency, simplicity, and productivity, while creating improved customer experiences. I want to thank Marykay for transforming our technology foundations and capabilities."

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Dave Treat, Chief Technology Officer, said: "Being part of Pearson at this thrilling juncture for the company is a source of pride for me, especially as technology begins to revolutionize how we learn and work. What Marykay and the digital and technology organization have accomplished over the years to modernize and expand our technology estate – especially with generative AI – is truly amazing. I am eager to take that work forward and explore new ways to leverage innovative technology to help people realize the life they imagine through learning."

Dave has helped to found and has served on several technology and industry boards including the Linux Hyperledger Foundation, Linux Open Wallet Foundation, Digital Dollar Project and the Global Business Blockchain Council.

Dave earned a Master's degree in Higher Education Administration from the University of Michigan and a degree in Psychology from the University of Pennsylvania. He will continue to be based in Connecticut, USA.

About Pearson At Pearson, our purpose is simple: to help people realize the life they imagine through learning. We believe that every learning opportunity is a chance for a personal breakthrough. That's why our c. 18,000 Pearson employees are committed to creating vibrant and enriching learning experiences designed for real-life impact. We are the world's lifelong learning company, serving customers in nearly 200 countries with digital content, assessments, qualifications, and data. For us, learning isn't just what we do. It's who we are. Visit us at pearsonplc.com.

Media Contacts
dan.nelson@pearson.com - US
laura.ewart@pearson.com - UK(PRNewsfoto/Pearson Education, Inc.)Cision

View original content to download multimedia:https://www.prnewswire.com/news-releases/pearson-announces-newly-expanded-role-for-chief-technology-officer-dave-treat-as-company-further-scales-ai-and-tech-capabilities-302415819.html

SOURCE Pearson

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31.03.25 12:00:00 Pearson Expands Professional Learning Capabilities with New Skilling Partner Program
4,600+ Pearson VUE third-party test centers worldwide can now add training to career certification services - creating one-stop learning and certification hubs; addresses the global skills gap

LONDON, March 31, 2025 /PRNewswire/ -- Pearson (FTSE: PSON.L), the world's leading learning company, today launched its Pearson Skilling Partner program, expanding its ability to deliver comprehensive skills training and career certification solutions worldwide. As AI and technology reshape industries at a breathtaking pace, people around the globe must continuously develop new skills. This new program aims to transform the company's extensive network of more than 4,600 authorized third-party Pearson VUE test centers across 178 countries into full-service learning and certification hubs, creating direct paths from skills development to certification.(PRNewsfoto/Pearson Education, Inc.)

Pearson VUE is a global leader in professional certification administering nearly 21 million certification and licensure exams annually (an exam every 1.5 seconds) in sectors spanning technology, healthcare, finance, and more. Each year, millions of professionals and 400+ organizations trust its professional testing programs to verify essential job-related skills and accelerate careers.

Addressing the Global Skills Gap

Pearson's new Lost in Transition: Fixing the "Learn to Earn" Skills Gap report reveals that inefficient career transitions and related learning gaps cost the U.S. economy alone $1.1 trillion annually. The report calls for improved, next-generation skills pathways and learning strategies to help to close the widening gap between available talent and employer demands.

"Pearson's new Skilling Partner program extends and helps deliver on our commitment to enterprise and professional learning," said Art Valentine, president for Pearson Assessment and Qualifications. "As technology impacts the global workforce, quick skill acquisition and validation have become crucial. Our Pearson Skilling Partner program creates a more responsive and convenient skills development ecosystem that equips people, employers, and economies with the modern skills needed to excel in our tech- and AI-powered future."

The new Skilling Partner program combines Pearson's established certification infrastructure with expanded learning resources. Participating skilling partners and learners can gain access to over 60 in-demand IT certification courses, comprehensive learning tools through the new Pearson Skilling Suite, and an extensive Training Marketplace featuring more than 2,000 courses.

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Authorized Pearson VUE Test Centers and skilling providers can apply to participate in the Pearson Skilling Partner program starting March 31, 2025.

For more information about the Pearson Skilling Partner Program and Skilling Suite, visit https://www.pearsonvue.com/us/en/training-centers/skilling-partner.

Related News

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About Pearson

At Pearson, our purpose is simple: to help people realize the life they imagine through learning. We believe that every learning opportunity is a chance for a personal breakthrough. That's why our c. 18,000 Pearson employees are committed to creating vibrant and enriching learning experiences designed for real-life impact. We are the world's lifelong learning company, serving customers in nearly 200 countries with digital content, assessments, qualifications, and data. For us, learning isn't just what we do. It's who we are. Visit us at pearsonplc.com.

Media Contact:

Dan Nelson, Vice President, Global Media Relations
Dan.nelson@pearson.com

Greg Forbes, Senior Global PR and Communications Manager
Greg.forbes@pearson.comCision

View original content to download multimedia:https://www.prnewswire.com/news-releases/pearson-expands-professional-learning-capabilities-with-new-skilling-partner-program-302414709.html

SOURCE Pearson

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16.03.25 07:36:06 Here's What We Like About Pearson's (LON:PSON) Upcoming Dividend
Some investors rely on dividends for growing their wealth, and if you're one of those dividend sleuths, you might be intrigued to know that Pearson plc (LON:PSON) is about to go ex-dividend in just 3 days. The ex-dividend date is usually set to be two business days before the record date, which is the cut-off date on which you must be present on the company's books as a shareholder in order to receive the dividend. The ex-dividend date is of consequence because whenever a stock is bought or sold, the trade can take two business days or more to settle. This means that investors who purchase Pearson's shares on or after the 20th of March will not receive the dividend, which will be paid on the 9th of May.

The company's next dividend payment will be UK£0.166 per share, on the back of last year when the company paid a total of UK£0.24 to shareholders. Based on the last year's worth of payments, Pearson stock has a trailing yield of around 1.9% on the current share price of UK£12.58. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.

Check out our latest analysis for Pearson

Dividends are typically paid out of company income, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut. Fortunately Pearson's payout ratio is modest, at just 37% of profit. A useful secondary check can be to evaluate whether Pearson generated enough free cash flow to afford its dividend. Fortunately, it paid out only 31% of its free cash flow in the past year.

It's encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously.

Click here to see the company's payout ratio, plus analyst estimates of its future dividends.LSE:PSON Historic Dividend March 16th 2025

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. For this reason, we're glad to see Pearson's earnings per share have risen 14% per annum over the last five years. Earnings per share have been growing rapidly and the company is retaining a majority of its earnings within the business. Fast-growing businesses that are reinvesting heavily are enticing from a dividend perspective, especially since they can often increase the payout ratio later.

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Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Pearson's dividend payments per share have declined at 6.7% per year on average over the past 10 years, which is uninspiring. Pearson is a rare case where dividends have been decreasing at the same time as earnings per share have been improving. It's unusual to see, and could point to unstable conditions in the core business, or more rarely an intensified focus on reinvesting profits.

To Sum It Up

Is Pearson worth buying for its dividend? It's great that Pearson is growing earnings per share while simultaneously paying out a low percentage of both its earnings and cash flow. It's disappointing to see the dividend has been cut at least once in the past, but as things stand now, the low payout ratio suggests a conservative approach to dividends, which we like. It's a promising combination that should mark this company worthy of closer attention.

Wondering what the future holds for Pearson? See what the nine analysts we track are forecasting, with this visualisation of its historical and future estimated earnings and cash flow

Generally, we wouldn't recommend just buying the first dividend stock you see. Here's a curated list of interesting stocks that are strong dividend payers.

Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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08.03.25 07:43:10 Pearson (LON:PSON) Is Increasing Its Dividend To £0.166
The board of Pearson plc (LON:PSON) has announced that it will be paying its dividend of £0.166 on the 9th of May, an increased payment from last year's comparable dividend. Although the dividend is now higher, the yield is only 1.9%, which is below the industry average.

See our latest analysis for Pearson

Pearson's Future Dividend Projections Appear Well Covered By Earnings

The dividend yield is a little bit low, but sustainability of the payments is also an important part of evaluating an income stock. However, Pearson's earnings easily cover the dividend. This means that most of its earnings are being retained to grow the business.

Over the next year, EPS is forecast to expand by 18.9%. If the dividend continues along recent trends, we estimate the payout ratio will be 27%, which is in the range that makes us comfortable with the sustainability of the dividend.LSE:PSON Historic Dividend March 8th 2025

Dividend Volatility

While the company has been paying a dividend for a long time, it has cut the dividend at least once in the last 10 years. Since 2015, the annual payment back then was £0.48, compared to the most recent full-year payment of £0.24. Doing the maths, this is a decline of about 6.7% per year. Generally, we don't like to see a dividend that has been declining over time as this can degrade shareholders' returns and indicate that the company may be running into problems.

The Dividend Looks Likely To Grow

Dividends have been going in the wrong direction, so we definitely want to see a different trend in the earnings per share. Pearson has impressed us by growing EPS at 14% per year over the past five years. A low payout ratio and decent growth suggests that the company is reinvesting well, and it also has plenty of room to increase the dividend over time.

Pearson Looks Like A Great Dividend Stock

Overall, a dividend increase is always good, and we think that Pearson is a strong income stock thanks to its track record and growing earnings. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. All of these factors considered, we think this has solid potential as a dividend stock.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. However, there are other things to consider for investors when analysing stock performance. Earnings growth generally bodes well for the future value of company dividend payments. See if the 9 Pearson analysts we track are forecasting continued growth with our freereport on analyst estimates for the company. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.

Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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07.03.25 14:00:00 Pearson Announces Arden Hoffman as Non-Executive Director
LONDON, March 7, 2025 /PRNewswire/ -- Pearson (FTSE: PSON.L), the world's lifelong learning company, today announces the appointment of Arden Hoffman as an independent Non-Executive Director, with effect from 1 June 2025. Arden has held significant leadership positions within high-profile organisations and brings to Pearson a strong expertise and business perspective on workforce and talent development in an era of innovation and AI."Pearson’s purpose of helping people to realise the life they imagine through learning is incredibly impactful and aligns with my own belief in the importance of empowering individuals through learning and growth. I’m excited to help Pearson make further progress against its purpose and strategy through my experience leading talent management efforts in global organisations and in the application of workforce learning at scale.”

Arden is the Chief People Officer at General Motors, a position she has held since 2023. Arden leads GM's talent management and organisational development and plays a critical role in fostering a culture of innovation, ensuring the company attracts, retains, and develops top talent in a rapidly evolving industry. She brings to the Board a strong background in human resources and talent development in the global automotive, technology, and financial services sectors. Prior to General Motors, Arden served as Chief People Officer at Cruise and as Global Head of Human Resources at Dropbox, in addition to holding senior positions in HR at Google and Goldman Sachs.

Omid Kordestani, Pearson Chair, said: "I'm thrilled to welcome Arden to the Pearson Board as we are evolving our business to meet transformational shifts in learning and in the workforce. She brings an innate passion for the power learning can bring at an individual and societal level, as well as experience in leading high performing teams in tech-driven businesses. Additionally, she complements the existing depth of experience on our Board and her workforce and talent expertise will prove invaluable as Pearson continues to execute against its strategy."

Arden Hoffman said: "Pearson's purpose of helping people to realise the life they imagine through learning is incredibly impactful and aligns with my own belief in the importance of empowering individuals through learning and growth. I'm excited to help Pearson make further progress against its purpose and strategy through my experience leading talent management efforts in global organisations and in the application of workforce learning at scale."

Arden earned an M.B.A from the Wharton School of the University of Pennsylvania and a bachelor's degree in Rhetoric from the University of California-Berkeley.

There is no further information to be declared in accordance with LR 6.4.8.

About Pearson

At Pearson, our purpose is simple: to help people realise the life they imagine through learning. We believe that every learning opportunity is a chance for a personal breakthrough. That's why our Pearson employees are committed to creating vibrant and enriching learning experiences designed for real-life impact. We are the world's lifelong learning company, serving customers with digital content, assessments, qualifications and data. For us, learning isn't just what we do. It's who we are. Visit us at pearsonplc.com.

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Media Contacts:
dan.nelson@pearson.com - US
laura.ewart@pearson.com - UK(PRNewsfoto/Pearson Education, Inc.)Cision

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SOURCE Pearson

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