Exploring the Sustainability and Growth of Dividends
Investment AB Latour (IVTBF, Financial) recently announced a dividend of $4.1 per share, payable on 2024-05-21, with the ex-dividend date set for 2024-05-15. 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 Investment AB Latour's dividend performance and assess its sustainability.
What Does Investment AB Latour Do?
Investment AB Latour is an investment holding company that makes investments in wholly owned industrial operations and a portfolio of securities. Latour has a long-term and activist orientation, with the vast majority of its total net asset value deriving from companies that have been in its portfolio for more than 20 years. The company measures its performance against its benchmark, the Stockholm Stock Exchange's total return index. Its criterion is to invest in companies that have their own products that meet growing international demand. Latour specifically evaluates four trends: demographic development, sustainability, globalization, and competition for limited resources.
A Glimpse at Investment AB Latour's Dividend History
Investment AB Latour 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 Investment AB Latour's Dividend Yield and Growth
As of today, Investment AB Latour currently has a 12-month trailing dividend yield of 1.45% and a 12-month forward dividend yield of 1.60%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, Investment AB Latour's annual dividend growth rate was 43.60%. Extended to a five-year horizon, this rate decreased to 12.70% per year. And over the past decade, Investment AB Latour's annual dividends per share growth rate stands at an impressive 10.20%.
Based on Investment AB Latour's dividend yield and five-year growth rate, the 5-year yield on cost of Investment AB Latour stock as of today is approximately 2.64%.
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, Investment AB Latour's dividend payout ratio is 0.40.
Investment AB Latour's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Investment AB Latour's profitability 9 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. Investment AB Latour's growth rank of 9 out of 10 suggests that the company's growth trajectory is good relative to its competitors. Revenue is the lifeblood of any company, and Investment AB Latour's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Investment AB Latour's revenue has increased by approximately 19.30% per year on average, a rate that outperforms approximately 65.31% 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, Investment AB Latour's earnings increased by approximately 3.40% per year on average, a rate that outperforms approximately 43.71% of global competitors. Lastly, the company's 5-year EBITDA growth rate of 11.10%, which outperforms approximately 60.5% of global competitors.
Conclusion
Investment AB Latour's robust dividend history, coupled with its sustainable payout ratios and promising growth metrics, positions it as a potentially attractive option for value investors focused on income and growth. With a proven track record of profitability and a strategic focus on sectors poised for expansion, Investment AB Latour appears well-equipped to continue its pattern of rewarding investors with stable and growing dividends. As we look to the future, the company's adherence to its investment criteria and its ability to adapt to global market trends will be crucial in sustaining its dividend payments.
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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.
