Yahoo Finance Danone SA's Dividend Analysis
Insight into Danone SA's Upcoming and Historical Dividend Performance
Danone SA (DANOY) recently announced a dividend of $0.46 per share, payable on 2024-05-29, with the ex-dividend date set for 2024-05-01. 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 Danone SA's dividend performance and assess its sustainability.
What Does Danone SA Do?
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Following the acquisition of WhiteWave, Danone SA restructured the firm into three broad segments: essential dairy and plant-based products, which represents just over half of group revenue; specialized nutrition; and bottled water. The firm's portfolio includes well-known brands such as Danone/Dannon dairy products, Nutrilon and Cow & Gate infant nutrition, Evian and Volvic bottled water, as well as leading medical nutrition brands. Danone SA derives about 60% of its annual sales outside Western Europe, up from about just one third in 2001.
A Glimpse at Danone SA's Dividend History
Danone SA has maintained a consistent dividend payment record since 1996. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Danone SA's Dividend Yield and Growth
As of today, Danone SA currently has a 12-month trailing dividend yield of 3.48% and a 12-month forward dividend yield of 3.62%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Danone SA's annual dividend growth rate was -1.60%. Extended to a five-year horizon, this rate increased to 0.50% per year. And over the past decade, Danone SA's annual dividends per share growth rate stands at 3.90%. Based on Danone SA's dividend yield and five-year growth rate, the 5-year yield on cost of Danone SA stock as of today is approximately 3.57%.
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, Danone SA's dividend payout ratio is 0.55.
Danone SA's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Danone SA's profitability 7 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported positive net income for each 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. Danone SA's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Danone SA's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Danone SA's revenue has increased by approximately 5.80% per year on average, a rate that underperforms than approximately 55.7% 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, Danone SA's earnings increased by approximately 2.00% per year on average, a rate that underperforms than approximately 57.09% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of -1.10%, which underperforms than approximately 65.52% of global competitors.
Next Steps
Considering Danone SA's consistent dividend payments, moderate dividend growth rate, reasonable payout ratio, solid profitability, and growth metrics, the company presents a compelling case for value investors seeking steady income. While its growth rates in revenue and earnings have not outperformed a majority of global competitors, its established market position and diverse product portfolio provide a level of stability. Investors should weigh these factors, alongside industry trends and regulatory changes, to determine if Danone SA aligns with their investment strategy. For those interested in expanding their portfolio with high-dividend yield stocks, GuruFocus Premium users can utilize the High Dividend Yield Screener for further research.
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.
This article first appeared on GuruFocus.
