Yahoo Finance Storebrand ASA's Dividend Analysis
Assessing the Sustainability of Storebrand ASA's Upcoming Dividend
Storebrand ASA (SREDF) recently announced a dividend of $4.1 per share, payable on 2024-04-16, with the ex-dividend date set for 2024-04-05. 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 Storebrand ASA's dividend performance and assess its sustainability.
What Does Storebrand ASA Do?
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Storebrand ASA is a Nordic long-term savings and insurance company. The business is divided into four segments: savings, insurance, guaranteed pensions, and others. The savings segment includes products for retirement savings with no interest rate guarantees which defined contribution pensions in Norway and Sweden, asset management, and retail banking products. The insurance segment provides risk products in Norway and Sweden, it provides health, property and casualty, personal risk products, and others. The Guaranteed Pension business area encompasses long-term pension savings products that give customers a guaranteed rate of return. Other segment consists of other companies within the Storebrand Group, including smaller subsidiaries of Storebrand Livsforsikring and SPP.
A Glimpse at Storebrand ASA's Dividend History
Storebrand ASA 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 Storebrand ASA's Dividend Yield and Growth
As of today, Storebrand ASA currently has a 12-month trailing dividend yield of 3.77% and a 12-month forward dividend yield of 4.16%. This suggests an expectation of increased dividend payments over the next 12 months. Based on Storebrand ASA's dividend yield and five-year growth rate, the 5-year yield on cost of Storebrand ASA stock as of today is approximately 3.77%.
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, Storebrand ASA's dividend payout ratio is 0.50.
Storebrand ASA's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Storebrand ASA's profitability 4 out of 10 as of 2023-12-31, suggesting the dividend may not be sustainable. 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. Storebrand ASA'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 Storebrand ASA's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Storebrand ASA's revenue has increased by approximately 22.40% per year on average, a rate that outperforms approximately 82.72% 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, Storebrand ASA's earnings increased by approximately 13.30% per year on average, a rate that outperforms approximately 45.86% of global competitors. Lastly, the company's 5-year EBITDA growth rate of 0.20%, which outperforms approximately 26.37% of global competitors.
Next Steps
Considering Storebrand ASA's consistent dividend payments, solid payout ratio, and strong revenue growth, investors may find the company an attractive option for dividend income. However, given the moderate profitability and growth ranks, it is essential for investors to monitor these metrics closely to ensure the dividends' sustainability. Will Storebrand ASA continue to navigate through market challenges and maintain its dividend streak? Only time will tell. For those interested in exploring further, 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.
