Yahoo Finance AptarGroup Inc's Dividend Analysis
Understanding AptarGroup Inc's Dividend Sustainability and Growth
AptarGroup Inc (NYSE:ATR) recently announced a dividend of $0.41 per share, payable on 2024-05-16, with the ex-dividend date set for 2024-04-24. 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 AptarGroup Inc's dividend performance and assess its sustainability.
What Does AptarGroup Inc Do?
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Headquartered in Crystal Lake, Illinois, AptarGroup is a leading global supplier of dispensing systems such as aerosol valves, pumps, closures, and elastomer packaging components to the consumer goods and pharmaceutical markets. With the bulk of its annual net sales coming from Europe (50% of sales) and the United States (33%), Aptar aims to increase its presence in Asia (10%) and Latin America (7%). It operates three business segments, Pharma, Beauty, and Closures. Pharma generates over two thirds of group profits.
A Glimpse at AptarGroup Inc's Dividend History
AptarGroup Inc has maintained a consistent dividend payment record since 1993. Dividends are currently distributed on a quarterly basis.
AptarGroup Inc has increased its dividend each year since 1993, earning it the prestigious title of a dividend aristocrat. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down AptarGroup Inc's Dividend Yield and Growth
As of today, AptarGroup Inc currently has a 12-month trailing dividend yield of 1.16% and a 12-month forward dividend yield of 1.18%, suggesting an expectation of increased dividend payments over the next 12 months.
Over the past three years, AptarGroup Inc's annual dividend growth rate was 3.10%. Extended to a five-year horizon, this rate increased to 3.30% per year. And over the past decade, AptarGroup Inc's annual dividends per share growth rate stands at 4.50%.
Based on AptarGroup Inc's dividend yield and five-year growth rate, the 5-year yield on cost of AptarGroup Inc stock as of today is approximately 1.36%.
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. As of 2023-12-31, AptarGroup Inc's dividend payout ratio is 0.33, indicating a balance between returning value to shareholders and retaining earnings for growth.
AptarGroup Inc's profitability rank of 8 out of 10 as of 2023-12-31 suggests 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
AptarGroup Inc's growth rank of 8 out of 10 suggests that the company's growth trajectory is good relative to its competitors. However, when looking at revenue growth, AptarGroup Inc's average annual increase of 6.40% underperforms approximately 54.31% of global competitors.
The company's 3-year EPS growth rate shows an average annual increase of 11.10%, which underperforms approximately 48.65% of global competitors. Additionally, the 5-year EBITDA growth rate of 3.40% underperforms approximately 64.12% of global competitors, indicating mixed performance in earnings growth.
Concluding Thoughts on AptarGroup Inc's Dividend Profile
Considering AptarGroup Inc's consistent dividend increases, a reasonable payout ratio, and a solid profitability rank, the company's dividend appears sustainable. However, investors should also consider the mixed growth metrics when assessing the future prospects of AptarGroup Inc's dividends. With a careful balance between yield and growth, AptarGroup Inc may continue to be a stable dividend-paying investment, but it is essential to keep an eye on the company's ability to adapt and grow in a competitive market.
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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.
