Assessing Swiss Prime Site AG's Dividend Sustainability and Growth
Swiss Prime Site AG (SWPRF, Financial) recently announced a dividend of $3.4 per share, payable on 2024-03-28, with the ex-dividend date set for 2024-03-26. 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 Swiss Prime Site AG's dividend performance and assess its sustainability.
What Does Swiss Prime Site AG Do?
Swiss Prime Site AG is a real estate company based in Switzerland. Its segments include: Real Estate, Asset Management, Retail, Corporate and Shared Services. The Real Estate segment consists of the firm's core real estate activities (the purchase, sale, lease, and development of properties) and financing of these activities. Asset Management includes the fund business, asset management and investment advisory. Retail segment consists of operation of department stores, and Corporate and Shared Services includes central group functions as well as internal services that are provided centrally. Majority of the revenue is generated from the Real Estate segment.
A Glimpse at Swiss Prime Site AG's Dividend History
Swiss Prime Site AG has maintained a consistent dividend payment record since 2021. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Swiss Prime Site AG's Dividend Yield and Growth
As of today, Swiss Prime Site AG currently has a 12-month trailing dividend yield of 3.72% and a 12-month forward dividend yield of 3.91%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Swiss Prime Site AG's annual dividend growth rate was -3.60%. Extended to a five-year horizon, this rate increased to -2.90% per year. And over the past decade, Swiss Prime Site AG's annual dividends per share growth rate stands at -0.50%.
Based on Swiss Prime Site AG's dividend yield and five-year growth rate, the 5-year yield on cost of Swiss Prime Site AG stock as of today is approximately 3.21%.
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, Swiss Prime Site AG's dividend payout ratio is 2.71. And this may suggest that the company's dividend may not be sustainable.
Swiss Prime Site AG's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Swiss Prime Site AG's profitability 7 out of 10 as of 2023-12-31, 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. Swiss Prime Site AG'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 Swiss Prime Site AG's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Swiss Prime Site AG's revenue has increased by approximately -5.70% per year on average, a rate that underperforms than approximately 68.76% 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, Swiss Prime Site AG's earnings increased by approximately -45.20% per year on average, a rate that underperforms than approximately 89.91% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of -19.00%, which underperforms than approximately 85.42% of global competitors.
Next Steps
Considering Swiss Prime Site AG's dividend payments, dividend growth rate, payout ratio, profitability, and growth metrics, investors should weigh the potential risks and rewards. The current yield and historical consistency of dividends are attractive, yet the negative growth rates and payout ratio raise questions about long-term sustainability. Staying informed about the company's financial health and market position is crucial for making a prudent investment decision. With a profitability rank that suggests good prospects, the decision to invest in Swiss Prime Site AG should be balanced against the backdrop of its growth challenges. 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.
