A Comprehensive Overview of EDP's Dividend Performance and Future Outlook
EDP - Energias de Portugal SA (EDPFY, Financial) recently announced a dividend of $2.08 per share, payable on a yet-to-be-disclosed date, with the ex-dividend date set for 2024-05-06. This forthcoming dividend has sparked interest among investors, prompting a closer look at the company's dividend history, yield, and growth rates. Utilizing comprehensive data from GuruFocus, this analysis delves into the sustainability and prospects of EDP - Energias de Portugal SA's dividends.
What Does EDP - Energias de Portugal SA Do?
EDP - Energias de Portugal SA operates as a vertically integrated utility company and stands as the largest generator, supplier, and distributor of electricity in Portugal. Its operations extend beyond Portugal, with significant activities in Spain, Brazil, and the US. EDP holds a 71% stake in EDP Renovaveis, the fourth-largest wind power owner/operator globally, and owns 54% of Energias do Brasil, which it plans to delist by the end of 2023.
A Glimpse at EDP - Energias de Portugal SA's Dividend History
EDP - Energias de Portugal SA has demonstrated a robust record of dividend payments since 2000, with distributions occurring annually. This consistent approach highlights the company's reliability in returning value to its shareholders.
Breaking Down EDP - Energias de Portugal SA's Dividend Yield and Growth
Currently, EDP - Energias de Portugal SA boasts a trailing dividend yield of 5.27% and a forward dividend yield of 5.22%, indicating a slight anticipated decrease in dividend payments over the next 12 months. Over the past three years, the annual dividend growth rate was a modest 0.70%, which slightly tapered to 0.60% over a five-year period. This trend is consistent over the past decade, maintaining a growth rate of 0.60% annually.
Given these metrics, the 5-year yield on cost for EDP - Energias de Portugal SA's stock is approximately 5.43% as of today.
The Sustainability Question: Payout Ratio and Profitability
The dividend payout ratio, sitting at 0.60 as of the end of 2023, suggests that EDP - Energias de Portugal SA retains a substantial portion of its earnings, which supports future growth and buffering against downturns. The company's profitability rank of 7 out of 10, coupled with consistent positive net income over the past decade, underscores its strong profitability relative to peers.
Growth Metrics: The Future Outlook
EDP - Energias de Portugal SA's growth rank of 7 suggests a promising trajectory relative to competitors. The company's revenue per share and 3-year revenue growth rate of 5.90% annually, although slightly lagging behind some global competitors, still indicates a robust revenue model. Furthermore, its 3-year EPS growth rate and 5-year EBITDA growth rate of 17.90% reinforce the company's capacity to sustain its dividend payments through continued earnings growth.
Conclusion
Considering EDP - Energias de Portugal SA's consistent dividend payments, modest growth rates, strong payout ratio, and solid profitability and growth metrics, the company appears well-positioned to maintain its dividend distributions. Investors seeking dividend stability coupled with potential growth may find EDP - Energias de Portugal SA an appealing option. For further exploration of high-dividend yield opportunities, GuruFocus Premium users can utilize 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.
