A comprehensive analysis of the company's dividend performance, sustainability, and future prospects
Grupo de Inversiones Suramericana SA (GIVSY, Financial) recently announced a dividend of $0.16 per share, payable on 2023-10-12, with the ex-dividend date set for 2023-09-22. 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 Grupo de Inversiones Suramericana SA's dividend performance and assess its sustainability.
Company Overview
Grupo de Inversiones Suramericana SA is a Latin American investment holding company with holdings in Colombian entities. Grupo Sura also holds stakes in companies throughout the Americas, including Chile, Mexico, Peru, Colombia, and Uruguay. The group's investment portfolio is mostly concentrated in the financial, pension, insurance, social security, and complimentary services industries. The company also holds smaller stakes in processed food, cement, and energy companies. Grupo Sura targets companies that emphasize innovation and offer complementary services across its portfolio holdings.
Dividend History
Grupo de Inversiones Suramericana SA has maintained a consistent dividend payment record since 2008. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Dividend Yield and Growth
As of today, Grupo de Inversiones Suramericana SA currently has a 12-month trailing dividend yield of 2.22% and a 12-month forward dividend yield of 2.64%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Grupo de Inversiones Suramericana SA's annual dividend growth rate was 12.50%. Extended to a five-year horizon, this rate decreased to 8.60% per year. And over the past decade, Grupo de Inversiones Suramericana SA's annual dividends per share growth rate stands at 8.40%.
Based on Grupo de Inversiones Suramericana SA's dividend yield and five-year growth rate, the 5-year yield on cost of Grupo de Inversiones Suramericana SA stock as of today is approximately 3.35%.
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, Grupo de Inversiones Suramericana SA's dividend payout ratio is 0.28.
Grupo de Inversiones Suramericana SA's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Grupo de Inversiones Suramericana SA's profitability 6 out of 10 as of 2023-06-30, suggesting fair profitability. The company has reported positive net income for each of year over the past decade, further solidifying its high profitability.
Growth Metrics
To ensure the sustainability of dividends, a company must have robust growth metrics. Grupo de Inversiones Suramericana SA'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 Grupo de Inversiones Suramericana SA's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Grupo de Inversiones Suramericana SA's revenue has increased by approximately 18.00% per year on average, a rate that outperforms approximately 87.34% 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, Grupo de Inversiones Suramericana SA's earnings increased by approximately 12.20% per year on average, a rate that outperforms approximately 67.57% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 1.30% outperforms approximately 36.36% of global competitors.
Conclusion
In conclusion, Grupo de Inversiones Suramericana SA's consistent dividend payments, impressive growth rate, and low payout ratio signal a promising future for value investors. The company's solid profitability and robust growth metrics further reinforce its potential for sustained dividend payouts. However, as with any investment, it's crucial to conduct thorough research and consider the company's overall financial health before making a decision.
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