Assessing the Sustainability of Andritz AG's Upcoming Dividend
Andritz AG (ADRZF) recently announced a dividend of $2.5 per share, payable on 2024-03-28, with the ex-dividend date set for 2024-03-25. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's look into Andritz AG's dividend performance and assess its sustainability.
This Powerful Chart Made Peter Lynch 29% A Year For 13 Years
How to calculate the intrinsic value of a stock?
Andritz AG is a producer of high-technology industrial machinery and operates through four operating segments: ANDRITZ Pulp & Paper provides sustainable technology, automation, and service solutions for the production of all types of pulp, paper, board, and tissue, ANDRITZ Metals includes suppliers of technologies, plants, and digital solutions in metal forming, and also includes automation and software solutions, process know-how, and service, ANDRITZ Hydro includes suppliers of electromechanical equipment and services for hydropower plants, and ANDRITZ Separation provides mechanical and thermal technologies as well as services and the related automation solutions for solid/liquid separation, serving the chemical, environmental, food, and the mining and minerals industries.
Andritz AG's Dividend Analysis
A Glimpse at Andritz AG's Dividend History
Andritz AG has maintained a consistent dividend payment record since 2008. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Andritz AG's Dividend Yield and Growth
As of today, Andritz AG currently has a 12-month trailing dividend yield of 3.60% and a 12-month forward dividend yield of 4.24%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Andritz AG's annual dividend growth rate was 61.30%. Extended to a five-year horizon, this rate decreased to 7.10% per year. And over the past decade, Andritz AG's annual dividends per share growth rate stands at 5.20%.
Based on Andritz AG's dividend yield and five-year growth rate, the 5-year yield on cost of Andritz AG stock as of today is approximately 5.07%.
Andritz AG's Dividend Analysis
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. The dividend payout ratio provides insights into the portion of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant part of its earnings, thereby ensuring the availability of funds for future growth and unexpected downturns. As of 2023-12-31, Andritz AG's dividend payout ratio is 0.41.
Andritz AG's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Andritz AG's profitability 8 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported positive net income for each of year over the past decade, further solidifying its high profitability.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Andritz AG's growth rank of 8 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Andritz AG's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Andritz AG's revenue has increased by approximately 8.90% per year on average, a rate that underperforms approximately 50.7% of global competitors.
The company's 3-year EPS growth rate showcases its capability to grow its earnings, a critical component for sustaining dividends in the long run. During the past three years, Andritz AG's earnings increased by approximately 33.10% per year on average, a rate that underperforms approximately 28.45% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 24.60%, which underperforms approximately 24.14% of global competitors.
Next Steps
In conclusion, Andritz AG's consistent dividend payments, favorable dividend growth rate, reasonable payout ratio, strong profitability, and solid growth metrics paint a picture of a company committed to rewarding shareholders while maintaining a stable financial foundation. As value investors consider the future prospects of their investments, Andritz AG appears to be positioning itself as a reliable contender in the dividend space. With the upcoming dividend payment, investors may find Andritz AG's stock to be an attractive addition to their portfolios, especially when considering the potential for long-term growth and income generation. Will Andritz AG continue to deliver shareholder value in the years to come?
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.