Assessing the sustainability of dorma+kaba Holding AG's dividend using GuruFocus data
dorma+kaba Holding AG (DRMKY, Financial) recently announced a dividend of $0.21 per share, payable on 2023-10-25, with the ex-dividend date set for 2023-10-06. 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 dorma+kaba Holding AG's dividend performance and assess its sustainability.
A Brief Overview of dorma+kaba Holding AG
dorma+kaba Holding AG is the result of the merger of Dorma and Kaba. The combined company forms a group that offers security hardware and systems to protect buildings and rooms. The products include door closers, architectural hardware, space and rescue doors, automatic doors and operators, physical access systems, electronic access control, workforce management, installation services, master key systems, cylinder locks, digital and electronic locks, lodging systems, safe locks, interior glass products, and movable walls. The company earns the majority of revenue from DACH segment involving Germany, Austria, and Switzerland.
Tracing dorma+kaba Holding AG's Dividend History
dorma+kaba Holding AG has maintained a consistent dividend payment record since 2017. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Understanding dorma+kaba Holding AG's Dividend Yield and Growth
As of today, dorma+kaba Holding AG currently has a 12-month trailing dividend yield of 1.21% and a 12-month forward dividend yield of 2.25%. This suggests an expectation of increased dividend payments over the next 12 months. However, dorma+kaba Holding AG's dividend yield of 1.21% is near a 10-year low and underperforms than 55.63 of global competitors in the Business Services industry, suggesting that the company's dividend yield may not be a compelling proposition for income investors.
Over the past three years, dorma+kaba Holding AG's annual dividend growth rate was -10.40%. Based on dorma+kaba Holding AG's dividend yield and five-year growth rate, the 5-year yield on cost of dorma+kaba Holding AG stock as of today is approximately 1.21%.
Assessing Dividend Sustainability: 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, dorma+kaba Holding AG's dividend payout ratio is 0.53.
dorma+kaba Holding AG's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks dorma+kaba Holding AG's profitability 7 out of 10 as of 2023-06-30, suggesting good profitability prospects. The company has reported positive net income for each year over the past decade, further solidifying its high profitability.
Examining Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. dorma+kaba Holding AG's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors. However, the company's 3-year EPS growth rate and 5-year EBITDA growth rate underperform a significant number of global competitors, indicating potential challenges in sustaining dividends in the long run.
Conclusion
While dorma+kaba Holding AG has a consistent dividend payment record and good profitability, its growth metrics and dividend yield pose questions about the sustainability of its dividends. It's essential for investors to monitor these factors closely. 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.
