An In-depth Look at Cementos Argos S.A.'s Dividend Performance and Sustainability
Cementos Argos S.A.(CMTOY, Financial) recently announced a dividend of $0.09 per share, payable on 2023-10-27, with the ex-dividend date set for 2023-10-20. 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 Cementos Argos S.A.'s dividend performance and assess its sustainability.
What Does Cementos Argos S.A. Do?
Cementos Argos S.A. is a cement producing company. In terms of the concrete business, it is Colombia's leading producer and the second-largest producer in the United States. The company's corporate purpose is the exploitation of the cement industry, the production of concrete mixes, and any other materials or items made of cement, lime, or clay, the acquisition and exploitation of minerals or deposits of exploitable minerals in the cement industry, and similar rights to explore and mine the aforementioned minerals, whether by concession, privilege, lease, or other title.
A Glimpse at Cementos Argos S.A.'s Dividend History
Cementos Argos S.A. 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.
Breaking Down Cementos Argos S.A.'s Dividend Yield and Growth
As of today, Cementos Argos S.A. currently has a 12-month trailing dividend yield of 5.75% and a 12-month forward dividend yield of 6.03%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Cementos Argos S.A.'s annual dividend growth rate was -4.50%. Extended to a five-year horizon, this rate decreased to -5.10% per year. And over the past decade, Cementos Argos S.A.'s annual dividends per share growth rate stands at 2.40%.
Based on Cementos Argos S.A.'s dividend yield and five-year growth rate, the 5-year yield on cost of Cementos Argos S.A. stock as of today is approximately 4.43%.
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, Cementos Argos S.A.'s dividend payout ratio is 1.20. And this may suggest that the company's dividend may not be sustainable.
Cementos Argos S.A.'s profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Cementos Argos S.A.'s profitability 8 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. Cementos Argos S.A.'s growth rank of 8 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Cementos Argos S.A.'s revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Cementos Argos S.A.'s revenue has increased by approximately 7.00% per year on average, a rate that outperforms approximately 57.1% 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, Cementos Argos S.A.'s earnings increased by approximately 4.70% per year on average, a rate that outperforms approximately 49.49% of global competitors.
Next Steps
Considering Cementos Argos S.A.'s dividend payments, dividend growth rate, payout ratio, profitability, and growth metrics, it appears that the company has a mixed dividend performance. While its dividend payments have been consistent, the negative growth rate and high payout ratio raise concerns about the sustainability of future dividends. However, the company's good profitability and growth metrics offer some reassurance. Investors interested in high-dividend yield stocks should continue to monitor Cementos Argos S.A.'s performance 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.
