Yahoo Finance Sandvik AB's Dividend Analysis
Assessing the Sustainability and Growth of Sandvik AB's Dividends
Sandvik AB (SDVKY) recently announced a dividend of $0.52 per share, payable on an unconfirmed date, 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 Sandvik AB's dividend performance and assess its sustainability.
What Does Sandvik AB Do?
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Sandvik is a manufacturer of specialized tools and mining equipment used predominantly by global mining, engineering, and automotive customers. The company's core operations are in metal cutting and mining equipment. The company has a well-documented history, having been founded in 1862 and listed on the Nordic Exchange in Stockholm in 1901.
A Glimpse at Sandvik AB's Dividend History
Sandvik AB has maintained a consistent dividend payment record since 2021. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Sandvik AB's Dividend Yield and Growth
As of today, Sandvik AB currently has a 12-month trailing dividend yield of 2.36% and a 12-month forward dividend yield of 2.53%. This suggests an expectation of increased dividend payments over the next 12 months. Based on Sandvik AB's dividend yield and five-year growth rate, the 5-year yield on cost of Sandvik AB stock as of today is approximately 2.36%.
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. 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, Sandvik AB's dividend payout ratio is 0.41.
Sandvik AB's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Sandvik AB's profitability 8 out of 10 as of 2024-03-31, 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. Sandvik AB'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 Sandvik AB's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Sandvik AB's revenue has increased by approximately 13.60% per year on average, a rate that outperforms approximately 67.69% 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, Sandvik AB's earnings increased by approximately 26.00% per year on average, a rate that outperforms approximately 67.39% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 10.00%, which outperforms approximately 53.72% of global competitors.
Next Steps
In conclusion, Sandvik AB exhibits a strong dividend profile with a history of consistent payouts, a reasonable payout ratio, and a solid profitability rank. The company's growth metrics, including revenue per share and EPS growth rates, underscore its ability to sustain and potentially increase dividends in the future. As Sandvik AB continues to navigate the dynamic manufacturing and mining equipment landscape, investors should monitor these key indicators to gauge the ongoing viability of the company's dividend payments. For those seeking additional high-dividend yield opportunities, GuruFocus Premium users can utilize the High Dividend Yield Screener to discover more promising stocks.
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.
