Understanding SSAB AB's Dividend Performance and Prospects
SSAB AB (SSAAY, Financial) recently announced a dividend of $0.24 per share, payable on 2024-05-17, with the ex-dividend date set for 2024-04-25. 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 SSAB AB's dividend performance and assess its sustainability.
What Does SSAB AB Do?
SSAB AB is a Sweden-based company that operates through five divisions. SSAB special steels sell structural high-strength steel, wear-resistant steel, protection steel, and tool steel. SSAB Europe is a Nordic-based producer of the strip, plate, and tube products. SSAB Americas is a Northern American steel plate and coil maker. Tibnor, SSAB's subsidiary, is a Nordic distributor of steel and nonferrous metals. Ruukki Construction, another subsidiary of SSAB, is a Europe-based provider of energy-efficient building and construction solutions. Steel products represent the majority of the company's sales. SSAB predominantly serves customers from heavy transport, construction, automotive, construction machinery, energy, and other sectors. SSAB generates the majority of its revenue from Europe.
A Glimpse at SSAB AB's Dividend History
SSAB AB has maintained a consistent dividend payment record since 2022. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down SSAB AB's Dividend Yield and Growth
As of today, SSAB AB currently has a 12-month trailing dividend yield of 13.96% and a 12-month forward dividend yield of 7.81%. This suggests an expectation of decreased dividend payments over the next 12 months.
Based on SSAB AB's dividend yield and five-year growth rate, the 5-year yield on cost of SSAB AB stock as of today is approximately 13.96%.
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, SSAB AB's dividend payout ratio is 0.68.
SSAB AB's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks SSAB AB's profitability 6 out of 10 as of 2023-12-31, suggesting fair profitability. The company has reported net profit in 6 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. SSAB AB's growth rank of 6 out of 10 suggests that the company has a fair growth outlook. Revenue is the lifeblood of any company, and SSAB AB's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. SSAB AB's revenue has increased by approximately 21.20% per year on average, a rate that outperforms approximately 78.87% of global competitors.
Concluding Thoughts on SSAB AB's Dividend Outlook
SSAB AB's track record of consistent dividends, coupled with a high dividend yield, positions it as an attractive option for income-focused investors. The company's solid payout ratio and fair profitability rank reflect a balanced approach to shareholder returns and business reinvestment. While the expected decrease in dividend payments could raise concerns, SSAB AB's strong growth metrics suggest a resilient revenue stream that could support future dividends. Investors considering SSAB AB should weigh these factors and monitor industry trends, regulatory changes, and strategic company developments that could influence dividend sustainability. 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.
