Yahoo Finance Intact Financial Corp's Dividend Analysis
Exploring the Sustainability and Growth of Intact Financial Corp's Dividends
Intact Financial Corp (IFCZF) recently announced a dividend of $1.21 per share, payable on 2024-06-28, with the ex-dividend date set for 2024-06-14. 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 Intact Financial Corp's dividend performance and assess its sustainability.
What Does Intact Financial Corp Do?
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Intact Financial Corp is a property and casualty insurance company that provides written premiums in Canada. The company distributes insurance under the Intact Insurance brand through a network of brokers and a wholly-owned subsidiary, BrokerLink, and directly to consumers through Belairdirect. Most of the company's direct premiums are written in the personal automotive space. Intact directly manages its investments through subsidiary Intact Investment Management. The vast majority of these invested assets are fixed-income securities. Its asset mix is designed to generate interest and dividend income.
A Glimpse at Intact Financial Corp's Dividend History
Intact Financial Corp has maintained a consistent dividend payment record since 2005. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Intact Financial Corp's Dividend Yield and Growth
As of today, Intact Financial Corp currently has a 12-month trailing dividend yield of 2.07% and a 12-month forward dividend yield of 2.17%. This suggests an expectation of increase in dividend payments over the next 12 months. Over the past three years, Intact Financial Corp's annual dividend growth rate was 9.80%. Extended to a five-year horizon, this rate decreased to 9.30% per year. And over the past decade, Intact Financial Corp's annual dividends per share growth rate stands at 9.30%.
Based on Intact Financial Corp's dividend yield and five-year growth rate, the 5-year yield on cost of Intact Financial Corp stock as of today is approximately 3.23%.
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 2024-03-31, Intact Financial Corp's dividend payout ratio is 0.45.
Intact Financial Corp's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Intact Financial Corp's profitability 7 out of 10 as of 2024-03-31, 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. Intact Financial Corp'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 Intact Financial Corp's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Intact Financial Corp's revenue has increased by approximately 12.90% per year on average, a rate that outperforms approximately 68.84% 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, Intact Financial Corp's earnings increased by approximately 5.10% per year on average, a rate that outperforms approximately 42.96% of global competitors. Lastly, the company's 5-year EBITDA growth rate of 20.30%, which outperforms approximately 82.43% of global competitors.
Conclusion: Assessing the Dividend Viability
Considering Intact Financial Corp's consistent dividend payments, robust growth metrics, and a healthy payout ratio, the company stands as a compelling candidate for value investors seeking sustainable dividend income. The future prospects of Intact Financial Corp appear promising, underpinned by strong financial health and strategic market positioning. For investors looking to delve deeper into dividend opportunities, GuruFocus Premium users can screen for high-dividend yield stocks using the High Dividend Yield Screener.
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.
