An In-depth Look at Gabelli Utility Trust's Dividend Performance and Sustainability
Gabelli Utility Trust (GUT, Financial) recently announced a dividend of $0.05 per share, payable on 2023-11-22, with the ex-dividend date set for 2023-11-14. 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 delve into Gabelli Utility Trust's dividend performance and assess its sustainability.
About Gabelli Utility Trust
Gabelli Utility Trust operates as a diversified closed-end investment management company. The fund's primary objective is the long-term growth of capital and income. To achieve its objective, the fund may invest 80% of its assets in common stocks and other securities of foreign and domestic companies involved in providing products, services, or equipment for the generation or distribution of electricity, gas, & water; and telecommunications services or infrastructure operations. It invests in various sectors, of which Electric Integrated, Water, Telecommunications, and U.S. Government Obligations account for the majority weightage.
Gabelli Utility Trust's Dividend History
Gabelli Utility Trust has maintained a consistent dividend payment record since 2018. Dividends are currently distributed on a monthly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Understanding Gabelli Utility Trust's Dividend Yield and Growth
As of today, Gabelli Utility Trust currently has a 12-month trailing dividend yield of 10.24% and a 12-month forward dividend yield of 10.24%. This suggests an expectation of same dividend payments over the next 12 months. Over the past three years, Gabelli Utility Trust's annual dividend growth rate was 2.30%. Based on Gabelli Utility Trust's dividend yield and five-year growth rate, the 5-year yield on cost of Gabelli Utility Trust stock as of today is approximately 10.24%.
Is Gabelli Utility Trust's Dividend Sustainable?
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, Gabelli Utility Trust's dividend payout ratio is 0.00. Gabelli Utility Trust's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Gabelli Utility Trust's profitability 2 out of 10 as of 2023-06-30, suggesting the dividend may not be sustainable. The company has reported net profit in 3 years out of past 10 years.
Growth Metrics and Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Gabelli Utility Trust's growth rank of 2 out of 10 suggests that the company has poor growth prospects and thus, the dividend may not be sustainable.
Conclusion
While Gabelli Utility Trust has a consistent dividend payment record and a substantial yield, its low profitability and growth ranks raise concerns about the sustainability of its dividends. Investors must pay close attention to these factors when making investment decisions. 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.
