Exploring the Sustainability and Growth of Holcim Ltd's Dividends
Holcim Ltd (HCMLY, Financial) recently announced a dividend of $0.62 per share, payable on May 31, 2024, with the ex-dividend date set for May 13, 2024. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using data from GuruFocus, let's delve into Holcim Ltd's dividend performance and assess its sustainability.
What Does Holcim Ltd Do?
Holcim is a global leader in the manufacture of a wide range of building materials. The merger between Lafarge and Holcim in 2015 solidified its position in the building materials sector. Recent strategic moves have diversified the group's exposure beyond heavy building materials, with approximately 40% of its revenue generated in North America.
A Glimpse at Holcim Ltd's Dividend History
Holcim Ltd has maintained a consistent dividend payment record since 2011, distributing dividends annually. Below is a chart showing annual Dividends Per Share to track historical trends.
Breaking Down Holcim Ltd's Dividend Yield and Growth
As of today, Holcim Ltd's trailing dividend yield stands at 3.09%, with a forward dividend yield projected at 3.43%. This indicates an expectation of increased dividend payments over the next 12 months. Over the past three years, Holcim Ltd's annual dividend growth rate was 7.70%, which decreased to 4.10% per year over a five-year horizon. Over the past decade, the annual dividends per share growth rate stands at 8.00%. The 5-year yield on cost for Holcim Ltd stock is approximately 3.78%.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one must evaluate the company's payout ratio. Holcim Ltd's dividend payout ratio is currently 0.46, suggesting that the company retains a significant portion of its earnings for future growth and stability. Additionally, Holcim Ltd's profitability rank is 7 out of 10, reflecting good profitability prospects with net profit reported in 8 out of the past 10 years.
Growth Metrics: The Future Outlook
Holcim Ltd's growth rank of 7 out of 10 suggests a positive growth trajectory relative to its competitors. Its revenue per share and 3-year revenue growth rate of 7.90% per year outperform approximately 53.26% of global competitors. The company's 3-year EPS growth rate of 24.10% per year and 5-year EBITDA growth rate of 11.80% further bolster its prospects for sustaining dividends.
Conclusion
With a robust dividend history, a promising yield, and strong growth metrics, Holcim Ltd appears well-positioned to continue rewarding investors with sustainable dividends. As the company navigates the complexities of the global building materials market, its strategic initiatives and financial health suggest that it remains a compelling choice for dividend-seeking investors. For those interested in exploring further, GuruFocus Premium offers tools like the High Dividend Yield Screener to discover other high-dividend opportunities.
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.
