An In-depth Analysis of Wyndham Hotels & Resorts Inc's Dividend History, Yield, and Growth Rates
Wyndham Hotels & Resorts Inc (WH, Financial) recently announced a dividend of $0.35 per share, payable on 2023-09-27, with the ex-dividend date set for 2023-09-12. 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 deep dive into Wyndham Hotels & Resorts Inc's dividend performance and assess its sustainability.
Overview of Wyndham Hotels & Resorts Inc
As of Dec. 31, 2022, Wyndham Hotels & Resorts operates 843,000 rooms across more than 20 brands predominantly in the economy and midscale segments. Super 8 is the largest brand, representing around 19% of all rooms, with Days Inn (14%) and Ramada (14%) the next two largest brands. During the past several years, the company has expanded its extended stay/lifestyle brands, which appeal to travelers seeking to experience the local culture of a given location. Wyndham launched a new extended stay economy scale segment concept, ECHO, in the spring of 2022. The United States represents roughly 60% of total rooms. The company closed its La Quinta acquisition in the second quarter of 2018, adding around 90,000 rooms at the time the deal closed.
A Glimpse at Wyndham Hotels & Resorts Inc's Dividend History
Wyndham Hotels & Resorts Inc has maintained a consistent dividend payment record since 2018. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Wyndham Hotels & Resorts Inc's Dividend Yield and Growth
As of today, Wyndham Hotels & Resorts Inc currently has a 12-month trailing dividend yield of 1.77% and a 12-month forward dividend yield of 1.85%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Wyndham Hotels & Resorts Inc's annual dividend growth rate was 3.30%. Based on Wyndham Hotels & Resorts Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Wyndham Hotels & Resorts Inc stock as of today is approximately 1.77%.
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 2023-06-30, Wyndham Hotels & Resorts Inc's dividend payout ratio is 0.40.
Wyndham Hotels & Resorts Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Wyndham Hotels & Resorts Inc's profitability 7 out of 10 as of 2023-06-30, 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. Wyndham Hotels & Resorts 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 Wyndham Hotels & Resorts Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Wyndham Hotels & Resorts Inc's revenue has increased by approximately -8.10% per year on average, a rate that underperforms than approximately 64.88% of global competitors.
The company's 3-year EPS growth rate showcases its capability to grow its earnings, a critical component for sustaining dividends in the long run. During the past three years, Wyndham Hotels & Resorts Inc's earnings increased by approximately 34.10% per year on average, a rate that underperforms than approximately 28.54% of global competitors.
Overall, Wyndham Hotels & Resorts Inc's consistent dividend payments, reasonable growth rate, sustainable payout ratio, and good profitability indicate a promising outlook for dividend investors. While the company has faced some challenges in revenue growth, its earnings growth rate suggests a strong potential for future dividends. As always, prospective investors should conduct their own thorough research before making investment decisions.
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