Understanding Radian Group Inc's Upcoming Dividend Payout
Radian Group Inc (RDN, Financial) recently announced a dividend of $0.25 per share, payable on 2024-03-12, with the ex-dividend date set for 2024-02-23. 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 delve into Radian Group Inc's dividend performance and evaluate its long-term viability.
What Does Radian Group Inc Do?
Radian Group Inc provides mortgage insurance and services to the real estate and mortgage finance industries. Radian's mortgage insurance offers protection to lending institutions across the United States. The company's array of services includes analytics and consulting for various stakeholders in mortgage- and real estate-related loans and securities, as well as other asset-backed securities. The bulk of Radian Group Inc's revenue stems from insurance premiums, with services revenue and investment income constituting other significant revenue streams. It operates primarily through two segments: Mortgage and homegenius, with the Mortgage segment being the primary revenue driver.
A Glimpse at Radian Group Inc's Dividend History
Radian Group Inc has upheld a steadfast record of dividend payments since 1993, with distributions currently made on a quarterly basis. The company has consistently increased its dividend annually since 2009, earning it the status of a dividend achiever—a recognition bestowed upon companies with at least 15 consecutive years of dividend growth. Below is a chart illustrating Radian Group Inc's Dividends Per Share history, reflecting its historical trends.
Breaking Down Radian Group Inc's Dividend Yield and Growth
Radian Group Inc currently sports a 12-month trailing dividend yield of 3.25% and a forward dividend yield of 3.57%, indicating anticipated dividend increases over the next year. Over the past three years, the company's annual dividend growth rate was a robust 330.90%, which tapered to 194.60% when viewed over a five-year span. However, the ten-year annual growth rate for dividends per share stands at a commendable 57.00%. Consequently, Radian Group Inc's 5-year yield on cost is an impressive 721.19% as of today.
The Sustainability Question: Payout Ratio and Profitability
The dividend payout ratio is a critical measure for assessing dividend sustainability, indicating the portion of earnings allocated to dividends. Radian Group Inc's dividend payout ratio stands at 0.23 as of 2023-12-31, signifying a healthy balance between dividend payments and retained earnings for future growth and resilience. The company's profitability rank is 7 out of 10, reflecting good profitability in comparison to industry peers. With a track record of net profit in 9 of the past 10 years, Radian Group Inc's financial health appears solid.
Growth Metrics: The Future Outlook
Growth metrics are essential for dividend sustainability, and Radian Group Inc's growth rank of 7 out of 10 suggests a promising growth trajectory. While the company's revenue per share and 3-year revenue growth rate demonstrate a strong revenue model, its average annual revenue growth of -1.30% lags behind approximately 69.98% of global competitors. The 3-year EPS growth rate, a vital indicator of earnings growth, averages 14.90% per year, underperforming approximately 31.12% of global peers. Additionally, the 5-year EBITDA growth rate of 14.60% falls short of approximately 25% of global competitors.
Concluding Thoughts on Radian Group Inc's Dividend Prospects
In conclusion, Radian Group Inc's dividend payments and growth rates paint a picture of a company committed to returning value to its shareholders. The prudent payout ratio and solid profitability rank indicate a sustainable dividend policy. While growth metrics present a mixed outlook, the company's consistent dividend increases and yield on cost suggest a positive future for income-seeking investors. As Radian Group Inc prepares to distribute its next dividend, investors should consider the company's historical performance, current payout sustainability, and growth prospects to make informed decisions. For those seeking high-dividend yield opportunities, GuruFocus Premium offers a valuable resource with 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.
