Unveiling the Dividend Performance and Sustainability of Mfs Intermediate High Income Fund (CIF, Financial)
Mfs Intermediate High Income Fund (CIF) recently announced a dividend of $0.01 per share, payable on 2023-10-31, with the ex-dividend date set for 2023-10-17. 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 dive into Mfs Intermediate High Income Fund's dividend performance and assess its sustainability.
What Does Mfs Intermediate High Income Fund Do?
Mfs Intermediate High Income Fund is a United States based diversified closed-end management investment company. Its investment objective is to seek high current income but may also consider capital appreciation. The fund invests a majority of its net assets, including borrowings for investment purposes, in high-income debt instruments. Its portfolio of investments includes investment in different sectors such as aerospace, automotive, broadcasting, building, business services, cable TV, chemicals, construction, and others.
A Glimpse at Mfs Intermediate High Income Fund's Dividend History
Mfs Intermediate High Income Fund has maintained a consistent dividend payment record since 1988. Dividends are currently distributed on a monthly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Mfs Intermediate High Income Fund's Dividend Yield and Growth
As of today, Mfs Intermediate High Income Fund currently has a 12-month trailing dividend yield of 11.16% and a 12-month forward dividend yield of 11.14%. This suggests an expectation of decreased dividend payments over the next 12 months.
Over the past three years, Mfs Intermediate High Income Fund's annual dividend growth rate was -7.50%. Extended to a five-year horizon, this rate increased to -5.60% per year.
Based on Mfs Intermediate High Income Fund's dividend yield and five-year growth rate, the 5-year yield on cost of Mfs Intermediate High Income Fund stock as of today is approximately 8.37%.
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 2023-05-31, Mfs Intermediate High Income Fund's dividend payout ratio is 0.00.
Mfs Intermediate High Income Fund's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Mfs Intermediate High Income Fund's profitability 2 out of 10 as of 2023-05-31, suggesting the dividend may not be sustainable. The company has reported net profit in 4 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. Mfs Intermediate High Income Fund's growth rank of 2 out of 10 suggests that the company has poor growth prospects and thus, the dividend may not be sustainable.
Conclusion
Considering Mfs Intermediate High Income Fund's dividend payments, dividend growth rate, payout ratio, profitability, and growth metrics, it appears that the company's dividends may not be sustainable in the long run. This is due to the company's low profitability and growth ranks, as well as its negative dividend growth rates. Therefore, investors should exercise caution when considering this stock for its dividends.
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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.
