Assessing Ayala Corp's Dividend Sustainability and Growth
Ayala Corp(AYYLF, Financial) recently announced a dividend of $3.81 per share, payable on 2024-01-10, with the ex-dividend date set for 2023-12-22. 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 Ayala Corps dividend performance and assess its sustainability.
What Does Ayala Corp Do?
Ayala Corporation is a general real estate company. The group is organized into a variety of business units. Ayala's real estate business is primarily conducted through its subsidiary, Ayala Land, Inc. Its involvement in financial services is through an affiliate, the Bank of the Philippine Islands. The group's business has the following main segments: Parent Company; Real estate and hotels; Financial services and insurance; Telecommunications; Industrial Technologies; Power Generation; and Automotive and Others.
A Glimpse at Ayala Corp's Dividend History
Ayala Corp has maintained a consistent dividend payment record since 2013. Dividends are currently distributed on a bi-annually basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Ayala Corp's Dividend Yield and Growth
As of today, Ayala Corp currently has a 12-month trailing dividend yield of 1.15% and a 12-month forward dividend yield of 1.21%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Ayala Corp's annual dividend growth rate was -5.90%. Extended to a five-year horizon, this rate increased to -0.50% per year. And over the past decade, Ayala Corp's annual dividends per share growth rate stands at 6.00%.
Based on Ayala Corp's dividend yield and five-year growth rate, the 5-year yield on cost of Ayala Corp stock as of today is approximately 1.12%.
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 2023-09-30, Ayala Corp's dividend payout ratio is 0.13.
Ayala Corp's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Ayala Corp's profitability 7 out of 10 as of 2023-09-30, suggesting good profitability prospects. The company has reported positive net income for each of year over the past decade, further solidifying its high profitability.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Ayala Corp's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Ayala Corp's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Ayala Corp's revenue has increased by approximately 0.20% per year on average, a rate that underperforms approximately 64.97% 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, Ayala Corp's earnings increased by approximately -13.30% per year on average, a rate that underperforms approximately 84.28% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of -5.40%, which underperforms approximately 80.57% of global competitors.
Next Steps
Considering Ayala Corp's dividend payments, growth rate, payout ratio, profitability, and growth metrics, investors should weigh these factors carefully. While the company has a stable dividend history and maintains a low payout ratio, which bodes well for sustainability, its growth metrics present a mixed picture with some areas underperforming the industry. Investors should keep an eye on these trends as they may influence the company's ability to maintain or increase its dividend payments in the future. For those seeking dividend-paying stocks, 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.
