Exploring the Sustainability and Growth of Dividends
Introduction to Orient Overseas (International) Ltd's Upcoming Dividend
Orient Overseas (International) Ltd (OROVF, Financial) recently announced a dividend of $0.04 per share, payable on 2024-06-28, with the ex-dividend date set for 2024-05-28. 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 Orient Overseas (International) Ltd's dividend performance and assess its sustainability.
What Does Orient Overseas (International) Ltd Do?
Orient Overseas (International) Ltd is engaged in container transport and logistics. The company's services include containerized shipping across major trade lanes such as Trans-Pacific, Trans-Atlantic, Asia/Europe, Asia/Australia, and Intra-Asia trades. It also offers integrated services for the management and control of the storage and flow of goods. The company's revenue streams include gross freight income, charter hire, service income, and rental income from investment properties. Its business is segmented into Container Transport and Logistics and Others.
A Glimpse at Orient Overseas (International) Ltd's Dividend History
Orient Overseas (International) Ltd has maintained a consistent dividend payment record since 2019, distributing dividends bi-annually. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Orient Overseas (International) Ltd's Dividend Yield and Growth
As of today, Orient Overseas (International) Ltd's trailing dividend yield over the past 12 months stands at 19.02%, with a forward dividend yield projected at 4.81%. This indicates an expected decrease in dividend payments over the next year. Over the past three years, the annual dividend growth rate was an impressive 251.40%. Additionally, the 5-year yield on cost is approximately 19.02%.
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. As of 2023-12-31, Orient Overseas (International) Ltd's dividend payout ratio is 1.63, which may suggest concerns about the sustainability of future dividends. However, the company's profitability rank of 7 out of 10, along with consistent net profit in 9 out of the past 10 years, indicates good profitability prospects.
Growth Metrics: The Future Outlook
Orient Overseas (International) Ltd's growth rank of 7 suggests a strong growth trajectory compared to its competitors. However, its revenue per share and 3-year revenue growth rate indicate a slight underperformance, with an average annual decrease of -0.90%. The company's 3-year EPS growth rate of 11.70% per year and a 5-year EBITDA growth rate of 125.60% reflect its capability to sustain dividends in the long run.
Conclusion
While Orient Overseas (International) Ltd demonstrates strong dividend growth and profitability, potential investors should consider the sustainability concerns indicated by the payout ratio and mixed growth metrics. For those interested in further exploring 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.
