Assessing the Dividend Performance of Cogeco Communications Inc (CGEAF, Financial)
Cogeco Communications Inc (CGEAF) recently announced a dividend of $0.85 per share, payable on 2024-02-07, with the ex-dividend date set for 2024-01-23. 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 Cogeco Communications Inc's dividend performance and assess its sustainability.
Company Profile: Cogeco Communications Inc
Cogeco Communications Inc is a communication corporation. The company is a cable operator in North America operating in Canada. It provides Internet, video, and phone services to residential, business, and other customers. The reportable segments of the company are Canadian telecommunications and American telecommunications. The company earns the majority of its revenue from American telecommunications. The company operates in Canada and the United States.
Dividend History and Achievements
Cogeco Communications Inc has maintained a consistent dividend payment record since 2004, distributing dividends on a quarterly basis. The company has increased its dividend each year since 2005, earning the status of a dividend achiever—an honor reserved for companies that have increased their dividend each year for at least the past 19 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Dividend Yield and Growth Analysis
As of today, Cogeco Communications Inc currently has a 12-month trailing dividend yield of 5.16% and a 12-month forward dividend yield of 5.56%, indicating an expectation of increased dividend payments over the next 12 months.
Over the past three years, Cogeco Communications Inc's annual dividend growth rate was 10.20%. Extending to a five-year horizon, this rate increased to 10.30% per year. And over the past decade, Cogeco Communications Inc's annual dividends per share growth rate stands at an impressive 11.20%.
Based on Cogeco Communications Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Cogeco Communications Inc stock as of today is approximately 8.42%.
Evaluating Dividend Sustainability
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 2023-11-30, Cogeco Communications Inc's dividend payout ratio is 0.38.
Cogeco Communications Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Cogeco Communications Inc's profitability 8 out of 10 as of 2023-11-30, suggesting good profitability prospects. The company has reported net profit in 9 years out of the past 10 years.
Future Growth Prospects
To ensure the sustainability of dividends, a company must have robust growth metrics. Cogeco Communications Inc'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 Cogeco Communications Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Cogeco Communications Inc's revenue has increased by approximately 10.90% per year on average, a rate that outperforms approximately 76.2% 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, Cogeco Communications Inc's earnings increased by approximately 8.30% per year on average, a rate that outperforms approximately 56.63% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 6.20%, which outperforms approximately 53.81% of global competitors, further bolsters confidence in its financial robustness.
Concluding Insights
In conclusion, Cogeco Communications Inc's consistent dividend growth, reasonable payout ratio, and solid profitability and growth metrics paint a promising picture for investors seeking reliable income streams. The company's ability to sustain and potentially increase its dividend is underpinned by strong financial health and a competitive position in the telecommunications industry. As investors consider the next steps, they may ponder whether Cogeco Communications Inc will continue its dividend achiever streak and how its strategic initiatives will support future payouts. Will Cogeco Communications Inc maintain its dividend growth trajectory in the evolving landscape of the telecommunications sector? For those seeking to diversify their portfolio with high-dividend yield stocks, GuruFocus Premium users can utilize the High Dividend Yield Screener to discover similar investment opportunities.
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.
