Yahoo Finanza Hochtief AG's Dividend Analysis
Assessing the Sustainability and Performance of Dividends
Hochtief AG (HOCFF) recently announced a dividend of $4.4 per share, payable on 2024-07-05, with the ex-dividend date set for 2024-04-26. 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 Hochtief AG's dividend performance and assess its sustainability.
What Does Hochtief AG Do?
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Hochtief AG develops and constructs building and infrastructure projects. It works on complex projects in transportation, energy, urban infrastructure, and mining markets. It expands transportation networks with roads, bridges, and tunnels, or designs and constructs office buildings, hospitals, and power plants. The company leans on expertise and technical know-how in developing, financing, building, and operating in designated business areas. Also, it will partner with external groups to work on specific components of a project. Hochtief reports operating segments by regional divisions: Americas, Asia Pacific, and Europe. The Americas and the Asia Pacific account for the majority of sales and are where the company's assets are located.
A Glimpse at Hochtief AG's Dividend History
Hochtief AG has maintained a consistent dividend payment record since 2013. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Hochtief AG's Dividend Yield and Growth
As of today, Hochtief AG currently has a 12-month trailing dividend yield of 4.17% and a 12-month forward dividend yield of 4.54%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, Hochtief AG's annual dividend growth rate was -11.60%. Extended to a five-year horizon, this rate increased to -6.70% per year. And over the past decade, Hochtief AG's annual dividends per share growth rate stands at an impressive 12.40%.
Based on Hochtief AG's dividend yield and five-year growth rate, the 5-year yield on cost of Hochtief AG stock as of today is approximately 2.95%.
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, Hochtief AG's dividend payout ratio is 0.58.
Hochtief AG's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Hochtief AG's profitability 5 out of 10 as of 2023-12-31, suggesting fair profitability. 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. Hochtief AG's growth rank of 5 out of 10 suggests that the company has a fair growth outlook. Revenue is the lifeblood of any company, and Hochtief AG's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Hochtief AG's revenue has increased by approximately 3.70% per year on average, a rate that underperforms approximately 54.13% of global competitors.
Concluding Insights on Hochtief AG's Dividend Viability
In conclusion, while Hochtief AG's dividend history shows resilience, the company's recent dividend growth rates and forward-looking yield projections indicate a nuanced financial strategy. With a moderate payout ratio and profitability rank, Hochtief AG appears to balance shareholder returns with reinvestment for future growth. However, the growth metrics, particularly the comparison with global competitors, suggest there may be challenges ahead. Investors considering Hochtief AG should weigh the current dividend attractiveness against the potential for future revenue and profit expansion. 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.
