Investigating the Sustainability and Growth of Owens-Corning Inc's Dividends
Owens-Corning Inc (OC, Financial) recently announced a dividend of $0.52 per share, payable on 2023-11-03, with the ex-dividend date set for 2023-10-13. 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 Owens-Corning Inc's dividend performance and assess its sustainability.
What Does Owens-Corning Inc Do?
Owens-Corning Inc is a manufacturer of glass fiber utilized in composites and building materials. It has an integrated business model with three reportable segments: Composites, Insulation, and Roofing. The company generates maximum revenue from the Insulation segment. Its Insulation segment manufactures and sells thermal and acoustical batts, loosefill insulation, spray foam insulation, foam sheathing, and accessories. It also manufactures and sells glass fiber pipe insulation, energy efficient flexible duct media, bonded and granulated mineral wool insulation, cellular glass insulation, and foam insulation used in above- and below-grade construction applications.
A Glimpse at Owens-Corning Inc's Dividend History
Owens-Corning Inc has maintained a consistent dividend payment record since 2014. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Owens-Corning Inc's Dividend Yield and Growth
As of today, Owens-Corning Inc currently has a 12-month trailing dividend yield of 1.41% and a 12-month forward dividend yield of 1.53%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Owens-Corning Inc's annual dividend growth rate was 20.40%. Extended to a five-year horizon, this rate decreased to 12.90% per year. Based on Owens-Corning Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Owens-Corning Inc stock as of today is approximately 2.59%.
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, Owens-Corning Inc's dividend payout ratio is 0.12.
Owens-Corning Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Owens-Corning Inc's profitability 9 out of 10 as of 2023-06-30, suggesting good profitability prospects. The company has reported net profit in 9 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. Owens-Corning Inc's growth rank of 9 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Owens-Corning Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Owens-Corning Inc's revenue has increased by approximately 15.40% per year on average, a rate that outperforms approximately 80.21% 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, Owens-Corning Inc's earnings increased by approximately 51.10% per year on average, a rate that outperforms approximately 87.26% of global competitors.
Conclusion
Owens-Corning Inc's consistent dividend payments, impressive growth rate, low payout ratio, high profitability, and strong growth metrics all point to a sustainable dividend. These factors make the company an attractive option for investors seeking steady income. However, as always, investors should perform their due diligence and consider other aspects of the company's performance and industry trends before making investment decisions.
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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.
