Assessing the Upcoming Dividend and Historical Performance of Linde PLC
Linde PLC (LIN, Financial) recently announced a dividend of $1.39 per share, payable on 2024-03-28, with the ex-dividend date set for 2024-03-13. 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 Linde PLC's dividend performance and assess its sustainability.
What Does Linde PLC Do?
Linde is the largest industrial gas supplier in the world, with operations in over 100 countries. The firm's main products are atmospheric gases (including oxygen, nitrogen, and argon) and process gases (including hydrogen, carbon dioxide, and helium), as well as equipment used in industrial gas production. Linde serves a wide variety of end markets, including chemicals, manufacturing, healthcare, and steelmaking. Linde generated approximately $33 billion in revenue in 2023.
A Glimpse at Linde PLC's Dividend History
Linde PLC has maintained a consistent dividend payment record since 1992. Dividends are currently distributed on a quarterly basis.
Linde PLC has increased its dividend each year since 1996, earning the title of a dividend aristocrat, a prestigious recognition for companies with at least 28 consecutive years of dividend increases. Below is a chart showing annual Dividends Per Share to track historical trends.
Breaking Down Linde PLC's Dividend Yield and Growth
As of today, Linde PLC currently has a 12-month trailing dividend yield of 1.07% and a 12-month forward dividend yield of 1.18%, indicating anticipated increases in dividend payments over the next year.
Linde PLC's dividend yield of 1.07% is near a 10-year low and underperforms 69.79% of global competitors in the Chemicals industry, suggesting that the company's dividend yield may not be a compelling proposition for income investors.
Over the past three years, Linde PLC's annual dividend growth rate was 9.80%. This rate decreased to 9.40% per year over a five-year horizon, and over the past decade, Linde PLC's annual dividends per share growth rate stands at 7.50%. Based on Linde PLC's dividend yield and five-year growth rate, the 5-year yield on cost of Linde PLC stock as of today is approximately 1.68%.
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, ensuring availability of funds for future growth and downturns. As of 2023-12-31, Linde PLC's dividend payout ratio is 0.36.
Linde PLC's profitability rank, as of 2023-12-31, is 9 out of 10, indicating good profitability prospects. The company has reported positive net income annually for the past decade, reinforcing its strong profitability status.
Growth Metrics: The Future Outlook
For dividends to be sustainable, a company must exhibit robust growth metrics. Linde PLC's growth rank is 9 out of 10, indicating a favorable growth trajectory compared to competitors.
Linde PLC's revenue per share and 3-year revenue growth rate reflect a strong revenue model, with an average annual increase of 9.20%, although this underperforms 51.44% of global competitors. The company's 3-year EPS growth rate of 19.90% per year, underperforms 38.84% of global competitors. Lastly, Linde PLC's 5-year EBITDA growth rate of 18.10% underperforms 33.3% of global competitors.
Next Steps
In conclusion, Linde PLC's upcoming dividend, consistent dividend growth, manageable payout ratio, and strong profitability paint a positive picture for current and potential investors. The company's growth metrics, while mixed in comparison to global competitors, still suggest a company capable of sustaining its dividend payments. Investors looking for high-dividend yield stocks can further explore opportunities using GuruFocus' High Dividend Yield Screener. With Linde PLC's next dividend date approaching, is the company's stock a strategic addition to your income-focused portfolio?
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.
