Delving Into Upbound Group Inc's Dividend Dynamics
Upbound Group Inc (UPBD, Financial) recently announced a dividend of $0.37 per share, payable on 2024-04-22, with the ex-dividend date set for 2024-04-02. 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 Upbound Group Inc's dividend performance and assess its sustainability.
What Does Upbound Group Inc Do?
Upbound Group Inc is an omnichannel platform company committed to elevating financial opportunity for all through inclusive, and technology-driven financial solutions that address the evolving needs and aspirations of consumers. It has four operating segments; The Rent-A-Center Business segment operates lease-to-own stores, the Acima segment offers the lease-to-own transaction to consumers who do not qualify for financing from the traditional retailer, and also offers the lease-to-own transaction through virtual offering solutions across e-commerce, digital, and mobile channels, Mexico segment offers lease-to-own stores in Mexico. The franchising segment offers the sale of rental merchandise to its franchisees. The company derives a majority of its revenue from the Acima segment.
A Glimpse at Upbound Group Inc's Dividend History
Upbound Group Inc has maintained a consistent dividend payment record since 2019. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Upbound Group Inc's Dividend Yield and Growth
As of today, Upbound Group Inc currently has a 12-month trailing dividend yield of 4.00% and a 12-month forward dividend yield of 4.25%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, Upbound Group Inc's annual dividend growth rate was 5.60%. Based on Upbound Group Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Upbound Group Inc stock as of today is approximately 4.00%.
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, Upbound Group Inc's dividend payout ratio is 2.32, and this may suggest that the company's dividend may not be sustainable. Upbound Group Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Upbound Group Inc's profitability 7 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported net profit in 7 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. Upbound Group Inc's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors. Revenue is the lifeblood of any company, and Upbound Group Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Upbound Group Inc's revenue has increased by approximately 12.90% per year on average, a rate that outperforms approximately 60.97% of global competitors.
Concluding Thoughts on Upbound Group Inc's Dividend Profile
In conclusion, Upbound Group Inc's dividend payments, dividend growth rate, payout ratio, profitability, and growth metrics paint a comprehensive picture for investors. While the dividend payout ratio may raise questions about sustainability, the company's solid profitability rank and positive growth metrics provide a counterbalance. These factors, along with a healthy dividend yield, make Upbound Group Inc an interesting prospect for value investors focused on income-generating stocks. As the financial landscape evolves, keeping a close eye on these indicators will be crucial for investors aiming to make informed decisions. 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.
