Yahoo Finance EFG International AG's Dividend Analysis
Assessing the Upcoming Dividend and Historical Performance of EFGIF
EFG International AG (EFGIF) recently announced a dividend of $0.55 per share, payable on 2024-03-28, with the ex-dividend date set for 2024-03-26. 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 EFG International AG's dividend performance and assess its sustainability.
What Does EFG International AG Do?
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EFG International AG is a Swiss international private banking and asset management group with operations that span the globe, including Europe, Asia, and the Americas. Most of its assets under management are in cash and deposits, equities, bonds, and loans. The company generates most of its income primarily from net banking fees and commission income and secondarily from net interest income. About three-fourths of its loan portfolio is due from customers, while the other-fourth comes from mortgages. The company's loan portfolio is mostly exposed to Latin America and the Caribbean, the United Kingdom, Asia and Oceania, and other parts of Europe.
A Glimpse at EFG International AG's Dividend History
EFG International AG has maintained a consistent dividend payment record since 2018. Dividends are currently distributed on a bi-annual basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down EFG International AG's Dividend Yield and Growth
As of today, EFG International AG currently has a 12-month trailing dividend yield of 4.01% and a 12-month forward dividend yield of 8.95%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, EFG International AG's annual dividend growth rate was 14.50%. Extended to a five-year horizon, this rate decreased to 10.50% per year. And over the past decade, EFG International AG's annual dividends per share growth rate stands at an impressive 10.50%.
Based on EFG International AG's dividend yield and five-year growth rate, the 5-year yield on cost of EFG International AG stock as of today is approximately 6.61%.
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, EFG International AG's dividend payout ratio is 0.45.
EFG International AG's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks EFG International AG's profitability 4 out of 10 as of 2023-12-31, suggesting the dividend may not be sustainable. The company has reported net profit in 9 years out of the past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. EFG International AG's growth rank of 4 out of 10 suggests that the company has poor growth prospects and thus, the dividend may not be sustainable.
Revenue is the lifeblood of any company, and EFG International AG's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. EFG International AG's revenue has increased by approximately 8.00% per year on average, a rate that outperforms approximately 57.23% 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, EFG International AG's earnings increased by approximately 35.40% per year on average, a rate that outperforms approximately 83.31% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 17.30%, which outperforms approximately 78.58% of global competitors.
Final Thoughts: Is EFG International AG's Dividend Sustainable?
Considering EFG International AG's consistent dividend history, attractive yield, and robust growth in earnings, the company presents a compelling case for dividend investors. However, its moderate profitability and growth ranks signal the need for cautious optimism. Investors should weigh these factors against their investment strategy and risk tolerance. Will EFG International AG continue to reward shareholders with growing dividends, or will economic headwinds challenge its ability to sustain payouts? Vigilant investors will keep a close eye on the company's financial health and market position.
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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.
