Assessing the Sustainability of INVH's Dividend Payouts
Invitation Homes Inc (INVH, Financial) recently announced a dividend of $0.28 per share, payable on 2024-04-19, with the ex-dividend date set for 2024-03-27. 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 Invitation Homes Inc's dividend performance and assess its sustainability.
What Does Invitation Homes Inc Do?
Invitation Homes owns a portfolio of over 84,000 single-family rental homes. The company focuses on owning homes in the starter and move-up segments of the housing market with an average sale price around $350,000 and generally less than 1,800 square feet. The portfolio is spread across 16 target markets that feature high employment and household formation growth with almost 70% of the portfolio in the Western U.S. and Florida; 15 of the 16 markets featuring average rents lower than homeownership costs.
A Glimpse at Invitation Homes Inc's Dividend History
Invitation Homes Inc has maintained a consistent dividend payment record since 2017, with dividends currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Invitation Homes Inc's Dividend Yield and Growth
As of today, Invitation Homes Inc currently has a 12-month trailing dividend yield of 3.07% and a 12-month forward dividend yield of 3.25%, suggesting an expectation of increased dividend payments over the next 12 months. Over the past three years, Invitation Homes Inc's annual dividend growth rate was 30.10%, which decreased to 22.80% per year over a five-year horizon. Based on the dividend yield and five-year growth rate, the 5-year yield on cost of Invitation Homes Inc stock as of today is approximately 8.57%.
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. As of 2023-12-31, Invitation Homes Inc's dividend payout ratio is 2.15, which may suggest that the company's dividend may not be sustainable. Furthermore, Invitation Homes Inc's profitability rank of 6 out of 10 as of 2023-12-31, suggests fair profitability, with the company reporting net profit in 5 years out of the past 10 years.
Growth Metrics: The Future Outlook
For dividends to be sustainable, a company must demonstrate robust growth metrics. Invitation Homes Inc's growth rank of 6 out of 10 suggests a fair growth outlook. Invitation Homes Inc's revenue per share and 3-year revenue growth rate indicate a strong revenue model, with revenue increasing by approximately 6.50% per year on average, outperforming approximately 64.5% of global competitors. The company's 3-year EPS growth rate also showcases its capability to grow earnings, critical for sustaining dividends in the long run, increasing by approximately 37.50% per year on average, outperforming approximately 81.99% of global competitors.
Engaging Conclusion: Dividend Prospects for Investors
Considering Invitation Homes Inc's consistent dividend payments, robust growth rate, challenging payout ratio, and fair profitability and growth metrics, investors should closely monitor the company's future earnings reports and strategic developments. These factors will be crucial in determining the sustainability of Invitation Homes Inc's dividend payments. For those seeking to expand their portfolios with high-dividend yield stocks, GuruFocus Premium users can utilize 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.
