Assessing the Dividend Yield, Growth, and Sustainability of Kenmare Resources PLC
Kenmare Resources PLC (KMRPF, Financial) recently announced a dividend of $0.18 per share, payable on 2023-10-13, with the ex-dividend date set for 2023-09-21. As investors anticipate this upcoming payment, the company's dividend history, yield, and growth rates come under scrutiny. Using data from GuruFocus, let's delve into Kenmare Resources PLC's dividend performance and evaluate its sustainability.
Understanding Kenmare Resources PLC's Business
Kenmare Resources PLC is a mining company that operates the Moma Titanium Minerals Mine located on the northern coast of Mozambique. Its product portfolio includes ilmenite, zircon, rutile, and concentrates. The majority of its revenue derives from the sale of ilmenite, with China being its primary market.
A Look at Kenmare Resources PLC's Dividend History
Kenmare Resources PLC has maintained a consistent dividend payment record since 2019, with dividends currently distributed bi-annually. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Examining Kenmare Resources PLC's Dividend Yield and Growth
Kenmare Resources PLC currently boasts a 12-month trailing dividend yield of 11.08% and a 12-month forward dividend yield of 12.41%, suggesting an expectation of increased dividend payments over the next 12 months.
Kenmare Resources PLC's dividend yield of 11.08% is near a 10-year high and outperforms approximately 90.6% of global competitors in the Metals & Mining industry, indicating that the company's dividend yield is an attractive proposition for income investors. Over the past three years, Kenmare Resources PLC's annual dividend growth rate was 146.30%.
Based on Kenmare Resources PLC's dividend yield and five-year growth rate, the 5-year yield on cost of Kenmare Resources PLC stock as of today is approximately 11.08%.
Assessing Dividend Sustainability: Payout Ratio and Profitability
To evaluate the sustainability of the dividend, it's crucial to examine the company's payout ratio. The dividend payout ratio offers 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, ensuring funds for future growth and unexpected downturns. As of 2023-06-30, Kenmare Resources PLC's dividend payout ratio is 0.25.
Kenmare Resources PLC's profitability rank of 8 out of 10 as of 2023-06-30 suggests good profitability prospects. The company has reported net profit in 6 years out of the past 10 years.
Evaluating Growth Metrics for Future Outlook
For dividends to be sustainable, a company must have robust growth metrics. Kenmare Resources PLC's growth rank of 8 out of 10 suggests a positive growth trajectory relative to its competitors. Furthermore, Kenmare Resources PLC's revenue has increased by approximately 33.60% per year on average, outperforming about 83.53% 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, Kenmare Resources PLC's earnings increased by approximately 78.70% per year on average, outperforming about 96.32% of global competitors. Lastly, the company's 5-year EBITDA growth rate of 51.10% outperforms about 94.73% of global competitors.
Conclusion: Kenmare Resources PLC's Dividend Prospects
Given Kenmare Resources PLC's consistent dividend payments, impressive dividend growth rate, sustainable payout ratio, strong profitability, and robust growth metrics, the company appears to be a compelling investment for income investors. However, as with any investment, potential investors should conduct thorough research and consider the company's overall financial health before making a decision.
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