Assessing the Sustainability of ING Groep NV's Upcoming Dividend
ING Groep NV (ING, Financial) recently announced a dividend of $0.82 per share, payable on 2024-05-10, with the ex-dividend date set for 2024-04-24. 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 ING Groep NV's dividend performance and assess its sustainability.
What Does ING Groep NV Do?
Formed from the merger of a Dutch postal bank and NN Insurance in 1991, ING Groep NV has expanded through acquisitions to establish a significant global presence. The 2008 financial crisis led to a government-backed restructuring, resulting in ING's focus solely on banking. ING boasts leading banking operations in the Netherlands and Belgium, alongside a portfolio of digital banks across Europe and Australia. Its wholesale banking division specializes in lending on a global scale.
A Glimpse at ING Groep NV's Dividend History
ING Groep NV has upheld a steady dividend payment since 2021, with distributions occurring bi-annually. This consistency is crucial for value investors who prioritize reliable income streams.
Below is a chart illustrating the annual Dividends Per Share to track historical trends.
Breaking Down ING Groep NV's Dividend Yield and Growth
As of today, ING Groep NV's trailing dividend yield stands at 4.89%, with a forward dividend yield projected at 7.34%. This anticipated increase in dividend payouts over the next 12 months reflects positively on future expectations.
Considering ING Groep NV's dividend yield and five-year growth rate, the 5-year yield on cost for the stock is approximately 4.89%.
The Sustainability Question: Payout Ratio and Profitability
Dividend sustainability is often gauged by the payout ratio. ING Groep NV's dividend payout ratio is currently 0.35, indicating a balanced approach between distributing earnings and retaining capital for growth and stability. This lower ratio is a positive signal for investors concerned with long-term value.
Further, ING Groep NV's profitability rank is 6 out of 10, signifying fair profitability compared to industry peers. The company's consistent positive net income over the past decade reinforces its financial health.
Growth Metrics: The Future Outlook
Dividend endurance also relies on growth metrics. ING Groep NV's growth rank of 6 suggests a reasonable growth trajectory. The company's revenue per share and 3-year revenue growth rate indicate a robust revenue model, with an average annual increase of 11.20%, outperforming approximately 66.76% of global competitors.
ING Groep NV's 3-year EPS growth rate has averaged an impressive 36.80% per year, surpassing roughly 81.75% of global competitors. Moreover, the 5-year EBITDA growth rate of 8.50% further underscores the company's competitive performance.
Next Steps
Considering ING Groep NV's upcoming dividend, historical dividend growth, prudent payout ratio, and solid profitability and growth metrics, investors have several positive indicators of the stock's potential as a reliable income investment. The balanced approach towards earnings distribution and growth investment suggests a sustainable dividend policy that could appeal to value investors focused on long-term returns.
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.
