Assessing the Sustainability and Prospects of GNT's Dividend Payments
GAMCO Natural Resources, Gold & Income Trust (GNT, Financial) recently announced a dividend of $0.03 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 GAMCO Natural Resources, Gold & Income Trust's dividend performance and assess its sustainability.
What Does GAMCO Natural Resources, Gold & Income Trust Do?
GAMCO Natural Resources, Gold & Income Trust is a non-diversified closed-end management investment company. The company's primary investment objective is to provide a high level of current income from interest, dividends, and options premiums. It invests in various sectors such as metals and mining, energy and energy services, specialty chemicals, agriculture, healthcare, machinery, food and beverage, and others.
A Glimpse at GAMCO Natural Resources, Gold & Income Trust's Dividend History
GAMCO Natural Resources, Gold & Income Trust has maintained a consistent dividend payment record since 2011. Dividends are currently distributed on a monthly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down GAMCO Natural Resources, Gold & Income Trust's Dividend Yield and Growth
As of today, GAMCO Natural Resources, Gold & Income Trust currently has a 12-month trailing dividend yield of 7.21% and a 12-month forward dividend yield of 7.21%. This suggests an expectation of same dividend payments over the next 12 months.
Over the past three years, GAMCO Natural Resources, Gold & Income Trust's annual dividend growth rate was -15.70%. Extended to a five-year horizon, this rate increased to -11.70% per year. Based on GAMCO Natural Resources, Gold & Income Trust's dividend yield and five-year growth rate, the 5-year yield on cost of GAMCO Natural Resources, Gold & Income Trust stock as of today is approximately 3.87%.
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, GAMCO Natural Resources, Gold & Income Trust's dividend payout ratio is 0.38.
GAMCO Natural Resources, Gold & Income Trust's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks GAMCO Natural Resources, Gold & Income 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 5 years out of past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. GAMCO Natural Resources, Gold & Income 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.
Revenue is the lifeblood of any company, and GAMCO Natural Resources, Gold & Income Trust's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. GAMCO Natural Resources, Gold & Income Trust's revenue has increased by approximately -27.20% per year on average, a rate that underperforms approximately 82.31% 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, GAMCO Natural Resources, Gold & Income Trust's earnings increased by approximately -34.60% per year on average, a rate that underperforms approximately 83.69% of global competitors.
Conclusion
In conclusion, while GAMCO Natural Resources, Gold & Income Trust has a consistent dividend payment record and a substantial yield, the company's negative growth rates and low profitability rank raise concerns about the sustainability of its dividends. The company's low payout ratio is a positive sign, but it's essential for investors to closely monitor the company's growth and profitability metrics for any future dividend prospects. Will GAMCO Natural Resources, Gold & Income Trust be able to improve its growth metrics and maintain its dividend payments? Only time will tell.
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.
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