Exploring the Upcoming Dividend and Its Historical Context
Reliance Inc (RS, Financial) recently announced a dividend of $1.1 per share, payable on 2024-06-07, with the ex-dividend date set for 2024-05-23. 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 look into Reliance Inc's dividend performance and assess its sustainability.
What Does Reliance Inc Do?
Reliance Inc is a diversified metal solutions provider and metals service center company. It provides value-added metals processing services and distributes a broad range of metal products to various industries. This strategic positioning allows Reliance Inc to cater to a wide customer base, enhancing its market stability and financial robustness.
A Glimpse at Reliance Inc's Dividend History
Reliance Inc has maintained a consistent dividend payment record since 1994, distributing dividends on a quarterly basis. The company has increased its dividend annually since 2014, earning it the status of a dividend achiever. This designation is reserved for companies that have consistently raised their dividends for at least ten consecutive years.
Below is a chart showing the annual Dividends Per Share, which illustrates historical trends and the company's commitment to returning value to shareholders.
Breaking Down Reliance Inc's Dividend Yield and Growth
Currently, Reliance Inc boasts a 12-month trailing dividend yield of 1.36% and a forward dividend yield of 1.46%, indicating an anticipated increase in dividend payments over the next year. Over the past three years, the company's annual dividend growth rate was an impressive 17.00%, slowing slightly to 15.20% over a five-year period, and maintaining a solid 10.60% over the past decade.
Given these figures, the 5-year yield on cost for Reliance Inc's stock is approximately 2.76%, showcasing an attractive return on initial investment based on current dividend growth rates.
The Sustainability Question: Payout Ratio and Profitability
The sustainability of dividends is often gauged by the dividend payout ratio, which for Reliance Inc stands at a healthy 0.19 as of 2024-03-31. This low ratio indicates that the company retains a substantial portion of its earnings, which supports future growth and provides a buffer against economic downturns. Additionally, Reliance Inc's profitability rank is an impressive 9 out of 10, reflecting strong earnings relative to its peers.
Growth Metrics: The Future Outlook
Reliance Inc's growth rank is also robust at 9 out of 10, suggesting a promising growth trajectory. The company's revenue per share and 3-year revenue growth rate, which has averaged 22.90% per year, outperform approximately 81.41% of global competitors. Similarly, its 3-year EPS growth rate and 5-year EBITDA growth rate have outperformed 79.45% and 74.47% of global competitors, respectively.
These metrics not only highlight Reliance Inc's strong market position but also reinforce the sustainability of its dividend payments in the face of future economic challenges.
Conclusion: A Robust Dividend Profile
In conclusion, Reliance Inc's consistent dividend increases, coupled with a low payout ratio and strong profitability and growth metrics, present a compelling case for investors looking for stable dividend income. As the company continues to perform well, it remains a potentially valuable addition to dividend-focused portfolios. For further exploration of high-dividend yield opportunities, 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.
