Unraveling the Dividend History, Yield, and Growth of Amcor PLC (AMCR, Financial)
Amcor PLC(AMCR) recently announced a dividend of $0.12 per share, payable on 2023-09-27, with the ex-dividend date set for 2023-09-06. 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 deep dive into Amcor PLCs dividend performance and assess its sustainability.
What Does Amcor PLC Do?
Amcor is a manufacturer of flexible and rigid plastic packaging and provides packaging solutions to the food, beverage, pharmaceuticals, medical, household, personal care, and industrials sectors. Operations span more than 40 countries and over 200 locations. Around half of group sales are derived from North America, one quarter from Europe, and the remainder from emerging markets. Amcor operates two distinct businesses: flexibles and rigids. Flexibles account for about 80% of earnings and produce plastic, aluminium, and fibre-based packaging. Rigids accounts for about 20% of earnings and consists of hot-fill and cold-fill polyethylene terephthalate bottling solutions in the North American and Latin American markets.
A Glimpse at Amcor PLC's Dividend History
Amcor PLC has maintained a consistent dividend payment record since 2019. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Amcor PLC's Dividend Yield and Growth
As of today, Amcor PLC currently has a 12-month trailing dividend yield of 5.15% and a 12-month forward dividend yield of 5.18%. This suggests an expectation of increase dividend payments over the next 12 months.
Amcor PLC's dividend yield of 5.15% is near a 10-year high and outperforms than 81.45 of global competitors in the Packaging & Containers industry, suggesting that the company's dividend yield stands out as an attractive proposition for income investors.
Over the past three years, Amcor PLC's annual dividend growth rate was 1.60%. Based on Amcor PLC's dividend yield and five-year growth rate, the 5-year yield on cost of Amcor PLC stock as of today is approximately 5.15%.
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 2023-06-30, Amcor PLC's dividend payout ratio is 0.69.
Amcor PLC's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Amcor PLC's profitability 7 out of 10 as of 2023-06-30, suggesting good profitability prospects. The company has reported positive net income for each of year over the past decade, further solidifying its high profitability.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Amcor PLC's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Amcor PLC's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Amcor PLC's revenue has increased by approximately 8.60% per year on average, a rate that outperforms than approximately 56.21% 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, Amcor PLC's earnings increased by approximately 22.10% per year on average, a rate that outperforms than approximately 67.71% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 10.10%, outperforms than approximately 56.78% of global competitors.
Conclusion
Given Amcor PLC's consistent dividend payments, impressive growth rate, sustainable payout ratio, high profitability, and robust growth metrics, it appears to be a promising choice for income investors. The company's ability to maintain a high dividend yield while also demonstrating strong growth and profitability underscores its potential to deliver value to shareholders in the long term. However, as with any investment, investors should conduct their due diligence before making a decision.
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