Exploring the Sustainability and Growth of Dividends
Vienna Insurance Group AG (VNRFY, Financial) recently announced a dividend of $0.3 per share, payable on 2024-06-10, with the ex-dividend date set for 2024-05-24. 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 Vienna Insurance Group AG's dividend performance and assess its sustainability.
What Does Vienna Insurance Group AG Do?
Vienna Insurance Group AG is a diversified insurance company that offers property and casualty, life, and health insurance products. The company maintains its goal of consolidating market leadership in Austria while taking advantage of the growth potential in Central and Eastern Europe. The company generates the majority of its revenue in Austria, followed by the Czech Republic and Poland. The company considers merger and acquisition investment as a component of its operational growth plan.
A Glimpse at Vienna Insurance Group AG's Dividend History
Vienna Insurance Group AG has maintained a consistent dividend payment record since 2009. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Vienna Insurance Group AG's Dividend Yield and Growth
As of today, Vienna Insurance Group AG currently has a 12-month trailing dividend yield of 3.88% and a 12-month forward dividend yield of 4.20%. This suggests an expectation of increase in dividend payments over the next 12 months.
Over the past three years, Vienna Insurance Group AG's annual dividend growth rate was 4.20%. Extended to a five-year horizon, this rate increased to 6.10% per year. And over the past decade, Vienna Insurance Group AG's annual dividends per share growth rate stands at -0.10%.
Based on Vienna Insurance Group AG's dividend yield and five-year growth rate, the 5-year yield on cost of Vienna Insurance Group AG stock as of today is approximately 5.22%.
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, Vienna Insurance Group AG's dividend payout ratio is 0.27.
Vienna Insurance Group AG's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Vienna Insurance Group AG's profitability 5 out of 10 as of 2023-12-31, suggesting fair profitability. The company has reported net profit in 9 years out of past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Vienna Insurance Group AG's growth rank of 5 out of 10 suggests that the company has a fair growth outlook.
Revenue is the lifeblood of any company, and Vienna Insurance Group AG's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Vienna Insurance Group AG's revenue has increased by approximately 4.00% per year on average, a rate that underperforms than approximately 59.07% 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, Vienna Insurance Group AG's earnings increased by approximately 19.90% per year on average, a rate that underperforms than approximately 35.73% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 12.80%, which underperforms than approximately 31.31% of global competitors.
Conclusion: Evaluating Dividend Viability
Considering Vienna Insurance Group AG's consistent dividend payments, growth in dividend rates, and a manageable payout ratio, the dividends appear sustainable in the near term. However, investors should keep an eye on the company's profitability and growth metrics, which are crucial for long-term dividend sustainability. For those interested in exploring more 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.
