Exploring the Dividend Performance and Sustainability of Itau Unibanco Holding SA
Introduction to Itau Unibanco Holding SA's Dividend Announcement
Itau Unibanco Holding SA (ITUB, Financial) recently announced a dividend of $0 per share, payable on 2024-06-10, with the ex-dividend date set for 2024-05-02. As investors anticipate this upcoming payment, it's crucial to delve into the company's dividend history, yield, and growth rates. Utilizing data from GuruFocus, this analysis will explore the dividend performance of Itau Unibanco Holding SA and evaluate its sustainability.
Overview of Itau Unibanco Holding SA
Itau Unibanco, the largest privately held bank in Brazil, emerged from the 2008 merger between Banco Itaú and Unibanco. The bank operates extensively not only in Brazil but also in Chile, Colombia, Argentina, Uruguay, and Paraguay. Itau Unibanco's portfolio includes commercial and consumer loans, which represent 33% and 44% of the bank's total loans respectively, with foreign loans comprising 23%. Additionally, it ranks as the fifth-largest insurer and the second-largest asset manager in Brazil, highlighting its significant influence in the Brazilian financial sector.
Itau Unibanco Holding SA's Dividend History
Itau Unibanco Holding SA has demonstrated a consistent commitment to dividend payments since 2001, with dividends currently distributed on a monthly basis. For a clearer perspective on its dividend consistency, below is a chart detailing the annual Dividends Per Share to track historical trends.
Analysis of Itau Unibanco Holding SA's Dividend Yield and Growth
As of today, Itau Unibanco Holding SA boasts a 12-month trailing dividend yield of 3.90% and a forward dividend yield of 0.67%, indicating an expected decrease in dividend payments over the next 12 months. Over the past three years, the annual dividend growth rate was an impressive 30.20%, though it moderated to 4.70% over a five-year period. Over the past decade, the annual dividends per share growth rate stands at 26.60%. The 5-year yield on cost for Itau Unibanco Holding SA stock is approximately 4.91% as of today.
Evaluating Dividend Sustainability: Payout Ratio and Profitability
The sustainability of dividends is often gauged by the dividend payout ratio, which for Itau Unibanco Holding SA stands at 0.33 as of 2023-12-31. This lower ratio indicates that the company retains a significant portion of its earnings, which supports future growth and buffers against economic downturns. Additionally, Itau Unibanco Holding SA's profitability rank is 6 out of 10, reflecting fair profitability with consistent positive net income over the past decade.
Future Growth Prospects
Itau Unibanco Holding SA's future dividend sustainability is supported by robust growth metrics. The company's growth rank of 6 suggests a fair growth outlook. Its revenue per share and 3-year revenue growth rate of approximately 13.70% annually outperform 73.58% of global competitors. The 3-year EPS growth rate of 23.90% and a 5-year EBITDA growth rate of 6.00% further reinforce its growth potential, outperforming 68.75% and 44.64% of global competitors, respectively.
Conclusion and Next Steps
Considering Itau Unibanco Holding SA's consistent dividend payments, robust growth rates, and strong payout ratio, the company appears well-positioned to sustain its dividend distributions in the foreseeable future. Investors seeking to explore other high-dividend yield opportunities may consider using the High Dividend Yield Screener available to GuruFocus Premium users.
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.
