A detailed examination of Pembina Pipeline Corp's dividend history, yield, growth rate, and its future prospects
Pembina Pipeline Corp(PBA, Financial) recently announced a dividend of $0.67 per share, payable on 2023-09-29, with the ex-dividend date set for 2023-09-14. 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 Pembina Pipeline Corps dividend performance and assess its sustainability.
Understanding Pembina Pipeline Corp's Business Model
Pembina Pipeline is a midstream company serving the Canadian and North American (primarily Bakken) markets with an integrated product portfolio. The firms' assets include pipelines and gas gathering as well as assets across fractionation, storage, and propane exports.
Reflecting on Pembina Pipeline Corp's Dividend History
Pembina Pipeline Corp has maintained a consistent dividend payment record since 1997. Dividends are currently distributed on a quarterly basis. Pembina Pipeline Corp has increased its dividend each year since 1998. The stock is thus listed as a dividend aristocrat, an honor that is given to companies that have increased their dividend each year for at least the past 25 years.
Deciphering Pembina Pipeline Corp's Dividend Yield and Growth
As of today, Pembina Pipeline Corp currently has a 12-month trailing dividend yield of 5.29% and a 12-month forward dividend yield of 6.50%. This suggests an expectation of increase dividend payments over the next 12 months.
Over the past three years, Pembina Pipeline Corp's annual dividend growth rate was 2.60%. Extended to a five-year horizon, this rate increased to 4.50% per year. And over the past decade, Pembina Pipeline Corp's annual dividends per share growth rate stands at 5.50%.
Based on Pembina Pipeline Corp's dividend yield and five-year growth rate, the 5-year yield on cost of Pembina Pipeline Corp stock as of today is approximately 6.59%.
Assessing the Sustainability of Pembina Pipeline Corp's Dividends
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, Pembina Pipeline Corp's dividend payout ratio is 0.54.
Pembina Pipeline Corp's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Pembina Pipeline Corp's profitability 7 out of 10 as of 2023-06-30, suggesting good profitability prospects. The company has reported net profit in 9 years out of past 10 years.
Projecting Pembina Pipeline Corp's Growth Prospects
To ensure the sustainability of dividends, a company must have robust growth metrics. Pembina Pipeline Corp'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 Pembina Pipeline Corp's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Pembina Pipeline Corp's revenue has increased by approximately 19.10% per year on average, a rate that outperforms than approximately 68.84% 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, Pembina Pipeline Corp's earnings increased by approximately 24.10% per year on average, a rate that outperforms than approximately 51.3% of global competitors.
Conclusion
With its consistent dividend payments, robust dividend growth rate, and a sustainable payout ratio, Pembina Pipeline Corp presents a compelling case for dividend-focused investors. The company's strong profitability and growth metrics further enhance its attractiveness. However, as with any investment, it's crucial to conduct thorough research and consider the overall market conditions before making a decision. GuruFocus Premium users can screen for high-dividend yield stocks using the High Dividend Yield Screener.
