Understanding the Dividend Prospects of Northern Star Resources Ltd
Northern Star Resources Ltd (NESRF, Financial) recently announced a dividend of $0.15 per share, payable on 2024-03-28, with the ex-dividend date set for 2024-03-06. 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 Northern Star Resources Ltd's dividend performance and assess its sustainability.
What Does Northern Star Resources Ltd Do?
Northern Star Resources Ltd is an Australia-based mid-tier global gold miner that sold around 1.6 million ounces of gold in fiscal 2023 from its three wholly-owned mining operations in Australia and Alaska. Its current operations are the result of significant merger and acquisition activity including 13 acquisitions and four asset sales since 2010. Northern Star had roughly a decade of reserves at the end of fiscal 2023.
A Glimpse at Northern Star Resources Ltd's Dividend History
Northern Star Resources Ltd has maintained a consistent dividend payment record since 2014. Dividends are currently distributed on a bi-annual basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Northern Star Resources Ltd's Dividend Yield and Growth
As of today, Northern Star Resources Ltd currently has a 12-month trailing dividend yield of 1.93% and a 12-month forward dividend yield of 2.19%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, Northern Star Resources Ltd's annual dividend growth rate was 14.50%. Extended to a five-year horizon, this rate increased to 17.90% per year. And over the past decade, Northern Star Resources Ltd's annual dividends per share growth rate stands at an impressive 23.00%.
Based on Northern Star Resources Ltd's dividend yield and five-year growth rate, the 5-year yield on cost of Northern Star Resources Ltd stock as of today is approximately 4.40%.
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 2023-12-31, Northern Star Resources Ltd's dividend payout ratio is 0.42.
Northern Star Resources Ltd's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Northern Star Resources Ltd's profitability 9 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported positive net income for each of 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. Northern Star Resources Ltd's growth rank of 9 out of 10 suggests that the company's growth trajectory is strong relative to its competitors.
Revenue is the lifeblood of any company, and Northern Star Resources Ltd's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Northern Star Resources Ltd's revenue has increased by approximately 7.70% per year on average, a rate that underperforms approximately 58.9% 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, Northern Star Resources Ltd's earnings increased by approximately 10.10% per year on average, a rate that underperforms approximately 49.57% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 15.30%, which underperforms approximately 45.95% of global competitors.
Conclusion: Evaluating Northern Star Resources Ltd's Dividend Fortitude
In conclusion, Northern Star Resources Ltd's consistent dividend payments, impressive growth rate in dividends per share, and a prudent payout ratio paint a picture of a company committed to shareholder returns. Combined with a high profitability rank and solid growth metrics, Northern Star Resources Ltd appears well-positioned to continue its dividend payments. However, investors should also consider the underperformance in revenue and earnings growth rates relative to global competitors, which may influence future dividend sustainability. As always, value investors should conduct thorough due diligence, considering both quantitative figures and qualitative aspects. For those seeking high-dividend yield opportunities, GuruFocus Premium users can leverage the High Dividend Yield Screener for further research and analysis.
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.
