An in-depth look at the dividend history, yield, growth, and future prospects of Western Asset Emg Markets Debt Fund Inc (EMD, Financial)
Western Asset Emg Markets Debt Fund Inc(EMD) recently announced a dividend of $0.09 per share, payable on 2023-10-02, with the ex-dividend date set for 2023-09-21. 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 deep dive into Western Asset Emg Markets Debt Fund Inc's dividend performance and assess its sustainability.
What Does Western Asset Emg Markets Debt Fund Inc Do?
Western Asset Emg Markets Debt Fund Inc is a non-diversified closed-end management investment company. Its primary investment objective is to seek high current income and the secondary objective is to seek capital appreciation.
A Glimpse at Western Asset Emg Markets Debt Fund Inc's Dividend History
Western Asset Emg Markets Debt Fund Inc has maintained a consistent dividend payment record since 2004. Dividends are currently distributed on a monthly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Western Asset Emg Markets Debt Fund Inc's Dividend Yield and Growth
As of today, Western Asset Emg Markets Debt Fund Inc currently has a 12-month trailing dividend yield of 10.35% and a 12-month forward dividend yield of 11.65%. This suggests an expectation of increase dividend payments over the next 12 months.
Over the past three years, Western Asset Emg Markets Debt Fund Inc's annual dividend growth rate was -5.90%. Extended to a five-year horizon, this rate increased to -3.60% per year. Based on Western Asset Emg Markets Debt Fund Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Western Asset Emg Markets Debt Fund Inc stock as of today is approximately 8.62%.
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 2023-06-30, Western Asset Emg Markets Debt Fund Inc's dividend payout ratio is 0.81. And this may suggest that the company's dividend may not be sustainable.
Western Asset Emg Markets Debt Fund Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Western Asset Emg Markets Debt Fund Inc's profitability 2 out of 10 as of 2023-06-30, suggesting the dividend may not be sustainable. The company has reported net profit in 3 years out of past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Western Asset Emg Markets Debt Fund Inc's growth rank of 2 out of 10 suggests that the company has poor growth prospects and thus, the dividend may not be sustainable.
Next Steps
Considering Western Asset Emg Markets Debt Fund Inc's dividend payments, dividend growth rate, payout ratio, profitability and growth metrics, it is essential for investors to weigh these factors before making informed financial decisions. While the company has a history of regular dividend payments, its payout ratio and growth metrics suggest potential challenges in maintaining the dividend in the long run. Therefore, investors should keep a close eye on these metrics for future investment decisions.
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